BP sells Arco Aluminum unit to Japanese consortium

[April 04, 2011]  LONDON (AP) -- BP announced Monday it is selling its Arco Aluminum subsidiary to a Japanese consortium for $680 million, but declined to comment on reports that it is about to restart drilling in the Gulf of Mexico.

The British company is selling Arco, a supplier of rolled aluminum sheet used mainly in the production of drink cans, as part of its drive to dispose of $30 billion in noncore assets by the end of this year.

Including the Arco deal, the company has notched up sales worth more than $24 billion.

"Although a strong business, Arco Aluminum is clearly a non-strategic asset for BP," said Chief Executive Bob Dudley. "Today's agreement will deliver an attractive price for the business, unlocking its value for our shareholders."

The Arco business, based in Louisville, Kentucky, is being sold to a consortium led by Sumitomo Light Metal Industries, Furukawa Sky Aluminum Corp. and Sumitomo Corp.

Meanwhile, BP declined to comment on reports that it had struck a deal with U.S. regulators to restart drilling in the Gulf of Mexico.

The Financial Times reported Monday that the London-based company has been given approval to drill 10 existing wells that were underway before the accident and that it needs to maintain or increase production on existing platforms.

BP needs approval from the U.S. Bureau of Ocean Energy Management, Regulation and Enforcement to restart any work in the Gulf.

The issue is a politically sensitive one for BP and President Barack Obama's administration as the fallout of last year's massive oil spill continues to reverberate. Any approval for drilling is expected to focus on existing production wells, rather than new exploration wells.

BP PLC shares were up 0.9 percent at 474.2 pence ($7.65) in morning trade on the London Stock Exchange.

[Associated Press]

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