A tiny hedge fund is becoming a thorn in the side of energy giant BP

London-based Bluebell Capital Partners aims at big targets via campaigns against world’s biggest cos, sometimes hitting them

-  Jenny Strasburg

Giuseppe Bivona and his partners run a tiny activist hedge fund from a small office here not far from Buckingham Palace. The single room has big windows, seven desks and little space for much else.

From this unlikely perch, the fund, called Bluebell Capital Partners, aims to punch far above its weight by launching campaigns against some of the world’s biggest companies, most of them in Europe. Sometimes the punches land.

The fund’s latest target, British oil giant BP, has already granted Bivona a meeting with its chairman, according to people familiar with the meeting. And BP’s new chief executive officer, Murray Auchincloss, last week was compelled to refute Bluebell’s arguments when announcing the company’s otherwise rosy earnings report.

That might seem an outsize response to a fund that has accumulated a holding likely worth less than 0.01% of BP’s roughly $103 billion market capitalization, based on Bluebell’s general description of its portfolio. Bluebell declined to disclose its exact investment.

Bluebell’s criticism could resonate because it taps into a core challenge facing BP: its commitment to shrinking oil-and-gas production while boosting investment in less-profitable green-energy sources.

Meanwhile many investors, including Bluebell, simply want more of BP’s cash to be handed back to them.

In his opening salvo to BP, a letter sent in October, Bivona called the plan to invest more in clean energy at the expense of oil-and-gas production “irrational." Bivona argues that doing so in effect strengthens competitors such as Shell, Exxon Mobil and Chevron, which aren’t setting short-term targets to dial back on drilling.

“You only make richer the shareholders of your competitor," said Bivona in an interview. “I’m questioning how they deploy capital, for sure. Big time."