Possible deal

‘BP negotiates with investment company Stonepeak over sale of Castrol’

Het Britse BP voert gesprekken met investeringsmaatschappij Stonepeak over de mogelijke verkoop van Castrol. Foto: Shutterstock

BP is in active negotiations with investment firm Stonepeak over the sale of its lubricants business Castrol, reports Reuters news agency. This possible deal would be an important step towards meeting the company’s $20 billion divestment target.

The sale process for Castrol began earlier this year. BP had announced in February that it would review the century-old lubricant brand as part of a broader change of direction away from renewable energy.

In September, both Stonepeak and investment firm One Rock made bids for Castrol. Sources stressed that it was not certain that a deal would eventually materialise. In doing so, Reuters news agency could not find out whether BP is still talking to One Rock or other parties. It is also not known exactly how much Stonepeak is offering or how the proposal is structured. Royal Bank of Canada analysts have estimated Castrol’s value at around $8 billion in recent weeks. BP, Stonepeak and One Rock declined to comment to Reuters.

Pressure from investors

BP is trying to increase profits and cut costs as it bets again on oil and gas. In August, the company launched a study on how best to develop or sell its oil and gas business. The possible sale of Castrol fits into BP’s broader plan to simplify the business and increase profitability, especially as it faces pressure from investors, including hedge fund Elliott.

This month, BP announced that underlying profit fell less than expected in the third quarter. Strong performance across all divisions, especially in refining, offset lower oil prices. Earlier, BP also announced it was selling its Dutch service stations to industry peer Catom, as part of its $20bn divestment programme.

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This article was automatically translated from the Dutch language original to English (British).

Author: Nina Koelewijn

Source: MobilityEnergy.com

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