More than 40 U.S. lawmakers on Wednesday called for BP to suspend its dividend, stop its advertising and spend that money cleaning up its oil spill in the Gulf of Mexico.
“Not a single cent” should be spent on television ads, said Rep. Lois Capps, D-Calif., at a news conference in Washington. “If BP is so concerned about its public image, it should plug the hole.”
The lawmakers said they were concerned that London-based BP may pay dividends before the full cost is known for cleaning up the continuing spill and compensating affected businesses and individuals along the Gulf Coast. A dividend moratorium would hit BP shareholders led by BlackRock and Legal & General Group.
Ms. Capps and Rep. Peter Welch, D-Vt., were among more than 40 lawmakers who signed a letter to BP CEO Tony Hayward asking the company to suspend dividends. Sens. Charles Schumer, D-N.Y., and Ron Wyden, D-Ore., had called earlier for the dividend to be halted.
Mr. Hayward and BP Chairman Carl-Henric Svanberg said on a June 4 conference call that the decision on whether to maintain the 14-cents-a-share quarterly dividend for the second quarter will be made on July 27. If they keep the same dividend this year as in 2009, the dividend yield, or ratio of payout to share price, is more than 10%, the highest among 18 peers according to Bloomberg data.
BlackRock was the biggest holder of BP shares, with 5.92% as of Dec. 31, according to Bloomberg data drawn from regulatory filings. L&G ranks second with 4% as of May 4.
Sovereign wealth funds are among BP's largest shareholders. As of May 1, Norges Bank Investment Management, which oversees Norway's Government Pension Fund-Global, held 1.8%; Kuwait Investment Authority, 1.8%; and the Republic of China, 1.1%.
Geographically, U.S. investors are the biggest holders in BP, with 9.4% via London-listed American depositary receipts and an additional 28% via New York-listed ADRs, both as of May 1, according to Junction RDS, a shareholder research firm.
Pension funds held 10% of BP, according to Junction RDS Managing Director Richard Jenkinson. Sovereign wealth funds held a collective 6%; life insurance companies, 4.9%; and mutual funds, 4.5%.
BP shares plunged to a 20-month low in London trading Wednesday, falling as much as 7%.