I don't know. You tell me. I'm just reading the following in the Sunday Times:
BP is working on a secret plan to raise $50 billion (£34 billion) to cover the cost of the Gulf of Mexico oil spill, more than twice the amount previously disclosed.
Directors approved the scheme last week. They want to make sure they have sufficient cash to deal with claims and bolster market confidence in the stricken oil giant’s finances.
Details of the fundraising emerged as Anadarko Petroleum, the junior partner in the ruptured well, prepared to file a “wilful misconduct” lawsuit that would shift its share of the multi-billion-dollar claims bill onto BP.
The first influx of cash could come as soon as next week with a $10 billion bond sale. The company is in talks with banks on arranging another $20 billion in loans. The final $20 billion is expected to come from asset sales over the next two years.
Carl-Henric Svanberg, the chairman, declined to comment on the plan’s details but said: “We need to have an unusually strong cash position.”
BP is accelerating its fundraising because its cost of borrowing could be about to soar. The three large ratings agencies slashed the group’s credit status last week amid fears that the claims from America’s worst environmental disaster could reach $100 billion.
Okay. No Goldman Sachs so far... maybe. Remember when Goldman Sachs was one of the bad guys? Took money from the government when most of the government money guys came from Goldman Sachs? They came out of it pretty well, having used great PR. Now the only corporation more detested than Goldman -- BP -- has turned to Goldman for public relations advice... and more.
In recent weeks, BP went looking for advisers to help it think through the liabilities of the spill. Considering BP’s own public relations problems, you might think it would stay far away from Goldman. But no, Goldman is now one of those advisers. ...
All of this may have you questioning why the public is so outraged — ostensibly on behalf of wronged Goldman clients — when many of the clients themselves seem unconcerned. ...NYT
And now BP is looking for help on raising that $50 billion from Goldman Sachs.
BP has hired several investment banks, including Goldman Sachs, the Blackstone Group and Credit Suisse, to advise on its options as it faces financial and political pressure over the Gulf of Mexico oil spill, people briefed on the matter told DealBook on Monday.
Among the matters the advisers have been asked to study are ways to handle BP’s mounting liabilities, one of these people said. The Obama administration has put pressure on the company to set aside money in escrow to finance potential liability claims and to withhold paying out its dividend. ...NYT
How much money has the US taxpayer handed over to Goldman Sachs? Aside from the $10 billion in TARP money it paid back? Will our money cover any part of that $50 billion BP is looking for? Will we somehow wind up paying for the $20 billion rescue fund? Recession victims want to know.
