BP Divests 65% Stake in Castrol to Stonepeak in $6 Billion Deal
On December 24, 2024, British energy titan BP disclosed its agreement to divest a 65% stake in its Castrol lubricants division to U.S. investment firm Stonepeak. The deal, valued at approximately $6 billion, pegs the total enterprise value of Castrol at $10.1 billion.
This transaction signifies a considerable progression in BP’s $20 billion divestment program. The program’s objective is to decrease debt and concentrate on core oil and gas operations. BP will maintain a 35% stake in the new joint venture, with an option to sell after a two-year lock-up period. The globally recognized Castrol brand, with a 126-year history, produces engine oils, industrial fluids, and greases.
“The sale marks an important milestone in the ongoing delivery of our reset strategy,” stated Carol Howle, BP’s interim CEO. “We are reducing complexity, focusing the downstream on our leading integrated businesses, and accelerating delivery of our plan.”
The Canada Pension Plan Investment Board has committed to investing up to $1.05 billion as part of the deal. The transaction is projected to close by the end of 2026, pending regulatory approvals. With this sale, BP’s completed and announced divestment proceeds total approximately $11 billion, more than halfway to its $20 billion target by 2027.
Source: BP Press Release