BP completes sale of 65% Castrol stake to Stonepeak
The deal brings around $6 billion in after-tax proceeds to reduce financial obligations, while BP keeps a 35% interest in the lubricants business it can sell after two years.
BP has completed the sale of a 65% stake in Castrol to infrastructure investor Stonepeak, receiving around $6 billion in after-tax proceeds. The amount includes about $0.8 billion linked to the pre-payment of future dividend income on BP’s retained stake. The company will use the proceeds to further reduce its financial obligations, in line with its priority of strengthening the balance sheet.
BP will hold its remaining 35% as an equity-accounted investment. It does not expect to recognize earnings or receive dividends from it in the short to medium term, as Stonepeak has a preference on distributions. After a two-year lock-up, BP may choose to sell the stake. Castrol will now operate as a standalone company with its own management, governance and strategic priorities.
“We are building a simpler, stronger, more valuable BP. This deal brings meaningful cash proceeds to BP today while retaining a valuable stake in Castrol’s future growth,” said Meg O’Neill, CEO of BP.
“Castrol begins the next part of its journey from a position of real strength, with trusted brands, strong customer relationships, talented colleagues and a clear strategy for growth,” said Michelle Jou, CEO of Castrol.
Headquartered in the UK, Castrol has operated for more than 127 years and employs over 6,000 people. It serves automotive, marine, industrial and energy customers, with products sold in more than 150 countries. Stonepeak manages about $98 billion in assets.
