BP chief executive Meg O'Neill has decided to pull the oil major out of drilling in the North Sea, the most talked-about deal in a burst of corporate activity on the last trading day of July.
The decision comes as Prime Minister Andy Burnham faces pressure from the Conservatives and the White House to resume North Sea drilling. Columnist Alex Brummer writes that economics in the North Sea and in Aberdeen, where the Conservatives won a little-noticed by-election, have been hit by former energy secretary Ed Miliband's green policies and a tax regime that leaves drillers facing a 78 per cent levy until 2030.
According to Brummer, this newspaper knew a BP pullout decision was on the agenda but was met with strong denials from the company at the time.
Brummer suggests that the more BP simplifies and slims down, the more likely a merger with Shell becomes. He writes he was told authoritatively last year that the Starmer government, worried about BP being weakened by repeated management upheaval, had privately received assurances that Shell would act as a "white knight" for a friendly takeover if an unwanted bid emerged. He adds that top investment bankers have floated the idea of a UK-based fossil fuel champion formed from a Shell-BP merger able to compete with Exxon and Chevron.
Shell is also simplifying its operations. The company announced its exit from the North Sea two years ago, and its latest disposal is the sale of its BG Cyprus operation to Hungary's MOL Group so it can concentrate on liquefied natural gas.
Sainsbury's sells Argos
Sainsbury's is selling Argos for £120 million to Swift Partners, a newly formed company headed by retail veteran Richard Pennycook. Brummer notes that figure is a fraction of the £1.4 billion Sainsbury's paid for Argos a decade ago, when it saw the retailer's logistics as a route into digital shopping. The integration proved clumsy, and Argos has struggled against Amazon.
Unilever is also focusing its business, with a merger of its food brands and US spice company McCormick.
HSBC retreats from Australia
HSBC, described as Britain's most valuable listed company with a market capitalisation of £271 billion, is disposing of overseas retail operations to concentrate on Asia. Its latest move is handing over its Australian $25.3 billion (£18 billion) mortgage and personal loan book to private equity firm Blackstone, along with an endowment.
Brummer argues the latest wave of FTSE 100 disposals is driven by a desire for simplicity, but also reflects a lack of ambition and entrepreneurship, and an unwillingness among executives to manage their way through challenges.
