BP CEO Happy For Abu Dhabi To Buy 10% Stake-Source

(This item was originally published Wednesday.) By Nour Malas Of ZAWYA DOW JONES DUBAI (Zawya Dow Jones)--BP PLC's (BP.LN) chief executive Tony Hayward is happy to see Abu Dhabi buy a stake of up to 10% in the U.K. company that's struggling to cap an oil spill disaster in the Gulf of Mexico after meeting with the sheikdom's powerful crown prince, a person with knowledge of the meeting told Zawya Dow Jones. Hayward in Abu Dhabi met with officials including Crown Prince Mohammed bin Zayed Al Nahyan and also spoke Wednesday to the company's employees in the emirate in a town hall gathering, according to a person familiar with his itinerary. "He'd be happy for Abu Dhabi to take a 10% equity stake," the person who asked not to be identified said. Abu Dhabi could provide embattled BP with an influential friend as it prepares to fend off any possible hostile takeover from a larger international rival, after its market value plummeted from the rising cost of capping its Gulf of Mexico leak. The sheikdom controls 90% of the oil in the United Arab Emirates and is a key U.S. ally in the Middle East. "This will certainly improve the liquidity position and also give a little more stability to BP," said Andre Frick, a commodity analyst who covers BP at Credit Suisse in Zurich. BP is no stranger to Middle East investment. Kuwait has owned shares in the company since it was first listed in London in the 1980's but was forced to reduce its stake in 1998 to less than 10% from 21.6% by U.K. regulators. According to data provider FactSet, the Kuwait Investment Authority held a 2.8% stake, or 530.5 million shares, in BP as of June 1. Sheila Williams, a spokeswoman for BP in London, declined to comment on specific meetings in Abu Dhabi but said Hayward "is visiting key business partners as well as staff." Hayward spoke to reporters before flying out of Abu Dhabi on Wednesday but gave little away about the purpose of his two-day visit to the emirate. "We are very delighted to meet with our long-term partners and friends," Hayward said as he prepared to board a flight bound for Angola, according to airport officials. A spokesman for Abu Dhabi's crown prince was unreachable for comment. A spokesman for the federal government in Abu Dhabi said he has no knowledge of the meetings. A spokesperson for Mubadala Development Co., the government investment firm chaired by the crown prince, said the company doesn't "comment on business meetings we may or may not be having." The firm's oil and gas business currently focuses on the Middle East, North Africa, the Caspian region and southeast Asia. SHARES CLIMB BP shares last traded Wednesday 5% higher at 362.7 pence in a slightly positive London market. The company tried to douse speculation Tuesday that it was looking for an investor to buy a large piece of the company, saying it wouldn't issue new stock to raise money to cover the costs of the Gulf of Mexico oil spill. Reports over the weekend suggested that BP was courting sovereign wealth funds in the Middle East including Abu Dhabi to buy new shares, enabling BP to raise about $9 billion in capital. Libya's top oil official, Shokri Ghanem, said Monday that BP was a bargain and recommended that the nation's sovereign wealth fund invest in the oil giant. The U.S. Department of Justice has also demanded in a letter that BP notifies it at least 30 days ahead of any significant financial or asset transactions. The U.K. oil giant's stock has lost almost half its value since the Deepwater Horizon rig explosion April 20 that triggered the spill. BP said it captured about 24,980 barrels of crude from the underwater gusher on Monday, indicating that oil-recovery efforts have stabilized after high seas hindered its efforts late last week. The company potentially faces tens of billions of dollars of liabilities related to the spill. BP has so far spent $3.12 billion on cleanup, containment and compensation, and has promised to pay a further $20 billion into an independently administered fund to cover future liabilities over the next 3.5 years. -By Nour Malas, Dow Jones Newswires, +97150 2890223; nour.malas@dowjones.com (Oliver Klaus and Tahani Karrar-Lewsley in Abu Dhabi contributed to this article) Copyright (c) 2010 Dow Jones & Co. (MORE TO FOLLOW) Dow Jones Newswires July 07, 2010 23:54 ET (03:54 GMT)