Repsol leaps into Mexico with lubricants joint venture
Repsol’s has made its biggest purchase in the lubricants business and will bolster the internationalization strategy of the company’s downstream unit.
Repsol has reached an agreement to acquire 40% of the Mexican automotive fluids and lubricants company Bardahl. This is the largest transaction to date for Repsol’s Lubricants unit, the company’s most global business unit, whose internationalization strategy will be significantly bolstered by this operation.
The alliance will allow Repsol to manufacture and sell its lubricants in Mexico through Bardahl, a company that operates one of Latin America’s most modern production plants, located in Toluca.
Bardahl has a 6% market share in Mexico and sells its products through its own network—the country’s broadest—consisting of 40 branches with more than 700 sales representatives and 10 exclusive distributors.
This investment is supported by the company’s plan to open service stations across the country. Repsol plans to invest about 400 million euros to open between 200 and 250 service stations per year in Mexico through 2022, aiming to achieve a market share between 8 and 10%.
Repsol’s current network already includes 60 service stations in nine states.
The transaction will create a joint venture—60% Bardahl, 40% Repsol—and is expected to be completed in the third quarter of 2018.
Currently, Spain represents approximately 55% of Repsol’s lubricants sales, while international business accounts for the remaining 45%.
