BP Sells Majority Stake in Motor Oil Division Castrol for $6bn.
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BP has struck a $6 billion agreement to divest a controlling interest in its lubricants business Castrol to a American investment group.
Details of the Major Deal
The energy major sold a 65% stake in Castrol, which produces oils for cars, motorcycles and industrial vehicles, to New York-based Stonepeak.
This transaction valued Castrol at $10.1bn, with BP receiving $6bn in cash, which it will allocate to reducing debt and enable it to concentrate on its core business.
BP will retain a 35% stake in Castrol, which it first took control of in the year 2000.
Strategic Pivot and Divestment Plan
The London-based energy corporation said the sale represents a "key moment" in its plans to restructure its business and reduce costs.
BP earlier this year announced plans to sell off $20 billion worth of holdings in a move to focus on its core crude oil and gas business and strengthen its financial position.
Following today's deal and previous announcements, the company states it is over half way to achieving that goal.
It is also changing its approach away from investment in renewable power and renewing its focus on fossil fuels after pressure from some investors who were frustrated that its profits and stock value had lagged behind competitors.
Industry Trends and Leadership Changes
Rivals like Shell and Norwegian company Equinor have also reduced plans to put money into renewables.
The Castrol sale comes a week after BP announced its inaugural woman CEO, Meg O'Neill, who will assume leadership in April 2026.
Her surprise appointment occurred only three months after BP named a new chairman, Albert Manifold.
And she was handed the top job less than two years after Murray Auchincloss succeeded Bernard Looney as CEO.
Continuing Business Streamlining
This recent transaction is the latest in a series of divestments by the firm, which have included selling its US onshore wind energy business and its Dutch mobility and convenience arm.
Interim chief executive Carol Howle commented the sale represents a "very good outcome for all stakeholders".
"We are simplifying our structure, focusing the downstream on our core integrated operations, and speeding up the execution of our strategy," she added.