Subject category:
Finance, Accounting and Control
Published by:
Harvard Business Publishing
Version: 1 November 2000
Length: 17 pages
Data source: Field research
Abstract
On 11 August 1998, United States' Amoco Corp (NYSE: AR) and the British Petroleum Co (BP), plc (NYSE: BP), announced the BPC merger with Amoco. This deal was the largest industrial merger to date, and created the world's third-largest oil company, BP (NYSE: BP). This case focuses on the issues surrounding the integration of the employee-defined contribution plans at Amoco and the U.S. subsidiary of BP. One of them was that the pre-merger plans had very different investment structures. While Amoco had offered its employees only low-cost index funds, BP America had relied on actively managed mutual funds. The new plan, which would have more than 40,000 participants and $7 billion in assets, would have to either choose one of these approaches, or try to integrate them into one single structure.
About
Abstract
On 11 August 1998, United States' Amoco Corp (NYSE: AR) and the British Petroleum Co (BP), plc (NYSE: BP), announced the BPC merger with Amoco. This deal was the largest industrial merger to date, and created the world's third-largest oil company, BP (NYSE: BP). This case focuses on the issues surrounding the integration of the employee-defined contribution plans at Amoco and the U.S. subsidiary of BP. One of them was that the pre-merger plans had very different investment structures. While Amoco had offered its employees only low-cost index funds, BP America had relied on actively managed mutual funds. The new plan, which would have more than 40,000 participants and $7 billion in assets, would have to either choose one of these approaches, or try to integrate them into one single structure.