LONDON (CNNfn) - BP Amoco executives approved a deal Wednesday to acquire U.S. oil company Atlantic Richfield, according to reports.
BP Amoco's board met in London to discuss the bid for the seventh largest U.S. oil producer in a deal which would create the world's number two integrated oil firm, according to Reuters.
Atlantic Richfield's (Arco) board is scheduled to meet in Los Angeles Wednesday to vote on the deal, estimated to be worth about $25 billion.
Both companies declined to comment but there is widespread speculation that a deal will be announced Thursday.
The takeover would consolidate BP Amoco's U.S. operations and boost its international portfolio in the rest of the world. The proposed deal has been warmly greeted by analysts who see potential savings of up to $1 billion in the two companies' Alaska operations alone.
Arco (ARC) shares climbed 9/16 to close at 74-5/8 Tuesday. BP Amoco is expected to bid $77 a share, an 11 percent premium on Arco's stock price before the deal was announced.
BP Amoco (BRP) shares slid 15 pence to 1,064 pence in early trading Wednesday.
-- from staff and wires