Market rumors persist about Chesapeake takeover

Shares of Oklahoma City-based Chesapeake climbed $1.88 on Wednesday to close at $24.83 per share on the New York Stock Exchange amid the speculation, but were back down $2.30, to $22.53 per share, when the markets closed Thursday.

Officials at both BP and Chesapeake declined to comment on Thursday, and several analysts said they doubted such a move was in the works.

Oil and gas analyst Justin Perucki of Chicago-based investment research firm Morningstar says even for Europe's second-largest oil company, such a takeover would be a challenge given current market conditions.

"Any buyout would involve a lot of equity," said Justin Perucki, an oil and gas analyst for Morningstar, a Chicago-based investment research firm. "BP does have a lot of cash ... but at the end of the day, I think it's a low-probability event."

Perucki says talk of possible takeovers generally picks up when a company's stock is undervalued.

But he said Chesapeake, the largest producer of natural gas in the U.S., would provide a growth opportunity in the U.S. market for a large energy company like BP.

"Chesapeake has a large acreage position in natural gas, so it's a pretty attractive growth opportunity for a larger company," Perucki said. "It would help their North America growth profile, to say the least."

Michael McCarty, chief equity and options strategist at New York-based Meridian Equity Partners, said asset-rich companies, like Chesapeake, are frequently prone to rumors about possible takeovers.

"The names that make the best fodder for those types of stories are names where there is value," he said.