Could BP move its financial resources to another company and then declare bankruptcy?

The BP name is now worth very little. Would this be a wise move if it is possible?

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  • 10 years ago
    Best Answer

    I am not an attorney as this seems like a legal question.

    However despite the very thought out answer from the legal assistant, keep in mind that there was this little automobile company called General Motors --- once the size and scope as being one of the largest corporations in the world, doing business in every modern country, with every major bank, went bankrupt.

    GM did a "363 Sale" which was approved by the bankruptcy court and allowed them to transfer the "good" assets to a new company and liquidate the bad assets to what has become Motors Liquidation Corp.

    http://lawprofessors.typepad.com/mergers/2009/07/g...

    Is it possible?

    Sure. It was done last year.

    The model for that court brief has already been written, approved and will be used in future case law for 363 sales.

    Will BP do this?

    I have no clue at this time.

    363 Sale

    http://www.mcguirewoods.com/news-resources/publica...

    "BP May Be at Bankruptcy Risk"

    http://netadvisor.wordpress.com/2010/06/09/bp-may-...

    Source(s): --- Finance & Risk Management Consultant --- 21 years in the markets (add me to view post history) --- Detailed bio and other work: http://netadvisor.wordpress.com/about/
  • Anonymous
    10 years ago

    No, because there are International treaties to domesticate bankruptcy actions in whatever country the assets are located in. Such treaties exist with virtually all nations that have robust enough banking systems to be able to handle the assets of a large global corporation like BP. These are seldom used in the case of small consumer bankruptcies (too much trouble, too expensive to pursue, too little benefit to creditors) but in the case of a large global corporation like PB, you'd better believe that creditors would go after assets moved to another country to try to avoid financial responsibilities in the USA.

    Source(s): Former Legal Assistant with a bankruptcy law firm
  • 10 years ago

    Go back and look at Exxon after the Valdez accident. There was much talk of BK damange never repaired, etc. and they have done fine.

    BP will hopefully learn from this terrible accident and be a better company in the future. If you consider they are one of the largest companies in the world and employ over 92,000 people and pay dividends to hundreds of thousands of shareholders much is at stake.

    The world will watch as 'they make this right'. If they don't, you are quite right they will go by the wayside likey by buy-out from another oil company.

  • 10 years ago

    If you consider 80 billion dollars 'very little', then you must be spoilt.

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