FTC May Vote to Sue BP Amoco, Arco

The Federal Trade Commission set a nonpublic meeting for Friday, in which it may vote to sue BP Amoco and Atlantic Richfield Corp. to halt their proposed $27-billion merger. The FTC must permit the merger to go through unless it sues to block the deal in U.S. District Court by Feb. 3. The proposed merger has stalled because of FTC concerns that the combination would violate antitrust laws by leading to higher gasoline prices on the West Coast. The government and the oil companies met in Washington for three hours in a last-ditch effort to see if any accommodation could be worked out to prevent the lawsuit--but none was announced. BP spokesman Tom Koch said: “We had as part of our discussions with the FTC a meeting . . . that lasted about three hours. The meeting was described as cordial.” The two sides have had differing positions on the divestiture of oil assets in Alaska. The FTC indicated a willingness to approve the deal if BP divested itself of Alaskan properties it would acquire from Arco that produce 350,000 barrels of oil per day. BP has taken the position that although it is willing to divest 350,000 barrels per day of Alaskan production, it wants to choose which properties it divests, sources said. BP Amoco’s American depositary receipts rose $1.56 to close at $56.25, while Arco gained $2.44 to close at $77.50, both on the New York Stock Exchange.