Motley Fool Money is a one-hour weekly business radio show hosted by Chris Hill, featuring Motley Fool analysts James Early, Seth Jayson, and Shannon Zimmerman. Each show includes a fast-paced roundtable discussion of the week's top investing stories, interviews with business leaders and authors, and specific stock ideas.
In this transcript from our most recent Motley Fool Money Radio Show, Chris talks BP
Chris: So let's talk about the company of the hour, of the week, of the month, and that's of course British Petroleum.
David: Chris, you're making the same mistake as everybody over in America. You're calling it British Petroleum. It's no longer British Petroleum. It hasn't been British Petroleum for ten years. And because President Obama called it British Petroleum, the politicians on this side are up in arms, Chris.
Chris: Well, that's why we're talking David. I'm keenly aware of what the perception is here in America but in the UK, what is the perception about BP and the oil spill crisis?
David: We all know that there's this massive oil disaster over in the Gulf of Mexico; the Deepwater Horizon disaster. Yet, it feels as though we're being pinned down by the American politicians, by the American president, and the American people. And of course you know, BP is, to a certain extent, culpable. There was this oil spill but I think the problem was that BP handled it very badly.
Chris: I would say so. Just recently after meeting with President Obama BP's Chairman, Carl Henrich-Svanberg, said that BP and this is his direct quote, "we care about the small people." Now to be fair, he's Swedish. English is not his first language. But when you take a quote like that and you add it to quotes from BP CEO Tony Hayward where he's saying things like he wants his life back, are you shaking your heads and slapping your foreheads or are you still defending it?
David: No, we don't defend that part of things. And we certainly say for a company as big as BP, they really should have a good public relations department and brief these people before they go and open their mouths. And to actually refer to the people who've been affected by this as the little people just makes us cringe. It just makes us feel really awful. We're all crouching down on our haunches and going "No, no don't say that." I think they've just handled the whole thing very badly. If you have a disaster like that, you want to be seen to be doing something. And I would have just mobilized everybody in BP, go down to the shores, go down where the affected areas are and let it be seen that you're trying to do something rather than to say "We're capping." We understand that this disaster happened many miles down into ocean so therefore nobody is going to see what's going on. But I think it is very important to have this perception that you're doing something rather than doing nothing.
Chris: David, I want to read you a couple of lines from a column in the The Globe and Mail newspaper from Canada: "Americans think BP boss Tony Hayward is an English toff because he has an English accent. They don't realize he is a down to earth geologist, educated at schools that Cambridge and Oxford grads would sneer at." Would BP be much better off with an American spokesman dealing with the media?
David: Yes. In situations like this, it is very important to have the right person out there. I know the chief executive has to be seen to be doing something but certainly I think you need somebody alongside you who can explain better to the people what's going on. But I'll tell you something else Chris. Over here people are scratching their heads and they're saying, "Why is BP the only company that is being vilified as a result of this?" On this side, whether it's BP themselves, whether it's their public relations department that's digging up all this information, they're saying that there are two American companies that are just as culpable. One of them is Transocean
Chris: Has there been any thought to what would happen if the roles were reversed? And instead it was off the coast of England, a US oil company had this spill, the CEO was a plain-spoken guy from Texas, and he was saying that he just wanted his life back?
David: Well, you see, that's the other thing. A lot of people refer to BP as being a British company but they seem to forget that BP merged with Amoco so therefore it is an Anglo-American company. And it is just as American as it is British and people seem to be forgetting this; that this is a global company. It drills all around the world and of course this disaster happened in America so therefore it feels as though it's going to be a lot worse than had it happened somewhere else. As much as I hate to say it, it just feels as though because it's happened very close to where you are, it is a disaster. Had it happened somewhere else, maybe not.
Chris: What was the reaction in the U.K. to BP's decision to suspend its dividend?
David: The shares shot up as soon as it said that. And as you and I know Chris, what the market hates most of all is uncertainty and in the case of BP they just wanted a line to be drawn under this disaster and I think BP has done that. BP has turned around and said yes it will accede to President Obama's wishes to have this fund of money, this pool of money, $20 billion. That is going to be put in place. And for its shareholders, they will bear some of the pain. They will not be getting dividends from now until the end of the year. But I think these are very good moves on the part of BP itself.
You can catch the entire interview with David Kuo on this week's Motley Fool Money Radio Show, which is uploaded every Friday by 6pm ET.