Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Tomas who wrote (86431)	2/6/2001 1:41:26 AM
From: Tomas	Respond to of 95453

Phillips/Tosco - Financial Times Lex Column, February 6 Phillips Petroleum's Dollars 7bn purchase of Tosco, an oil refiner and marketer, flies in the face of the US oil group's declared intentions. For the past 18 months, Phillips has been trying to offload its own refining and marketing operations into a joint venture in order to concentrate on its more profitable exploration and production arm - bulked up with the Dollars 6.7bn purchase of Arco's Alaskan assets last April. The change of heart is hard to justify. Granted, Phillips was having trouble getting rid of its own. But this is precisely because refining, plagued by overcapacity, traditionally produces low returns. In 2000, a top of the cycle year, Phillips' refining and marketing division managed a net margin of just 2.4 per cent. Phillips argues that as a better balanced group it will be less exposed to oil price fluctuations. But surely investors can decide for themselves how much exposure they can tolerate. The real point of the purchase may be that Phillips, a medium-sized company in an industry of giants, felt vulnerable and decided to swallow rather than be swallowed. Given the market reaction, it may now be more vulnerable to a bid than ever.