BHP eyes Shell stake ahead of Woodside bid: report

LONDON (Reuters) – BHP Billiton (BLT.L: Quote, Profile, Research), the world’s top mining company, wants to buy Royal Dutch Shell’s (RDSa.L: Quote, Profile, Research) stake in Woodside Petroleum (WPL.AX: Quote, Profile, Research) ahead of launching a full takeover for the Australian oil and gas producer, a newspaper report said.

BHP is in talks with Shell, which holds a 24 percent stake in Woodside, about taking its shares in return for some of BHP’s assets, including the Sunrise gas field, British newspaper the Sunday Times reported.

BHP declined to comment when contacted by Reuters.

Talk of a BHP bid picked up steam last November when Shell sold a third of its stake in Woodside and said it would be willing to sell the remaining 24 percent. BHP has plenty of cash to put to work after enjoying a boom in commodity prices.

Price concerns have seen shareholders and analysts pour cold water on the bid, while another clue that a deal is not close is that BHP has not suspended its off-market share buyback, with the tender for shares due to close on April 8.

The takeover rumor gained currency because Woodside is seen as an obvious target for BHP.

Oil and gas is one of the few areas where BHP could make a major acquisition without running into competition concerns, after it was blocked on three major deals in metals and mining over the past three years.

(Writing by Neil Maidment; additional reporting by Clara Ferreira Marques)

BHP eyes Shell stake ahead of Woodside bid: report