8 months ago
BP Sells 65% Stake in Castrol
BP, a big oil company, has sold a large part of its Castrol business to a company called Stonepeak.
Castrol makes oils and lubricants.
BP is keeping a smaller part of Castrol and will use the money from the sale to pay off some of its debts.
Another company, Canada Pension Plan Investment Board, is also putting money into this deal.
BP has been trying to sell some of its businesses to make the company more profitable.
They recently appointed a new CEO to help with this plan.
The sale of Castrol is a big step in BP's plan to become a more focused and profitable company.
The deal includes a 49% stake in Castrol India and entities in other countries like Vietnam, Saudi Arabia, and Thailand.
Stonepeak, the buyer, is a big investment firm that manages a lot of money.
BP agreed to sell a 65% stake in Castrol to Stonepeak for $6 billion, valuing Castrol at $10.1 billion.
BP will retain a 35% stake in a new joint venture with Stonepeak and may sell it after a two-year lock-in period.
The sale proceeds, including $800 million for accelerated dividend payments, will be used to reduce BP's debt.
Canada Pension Plan Investment Board will invest up to $1.05 billion in the deal, gaining an indirect stake in Castrol.
The sale is part of BP's strategy to divest about $20 billion in assets by 2027 to reduce debt and cut costs.
- Who
- BP and Stonepeak
- What
- Sale of 65% stake in Castrol
- Where
- Global, with BP headquartered in London
- When
- Agreement announced on Wednesday, December 24, 2025
- Why
- To reduce debt and cut costs as part of BP's asset-disposal strategy
BP's Strategy
Investor Concerns
Asset Disposal
BP's Strategy
BP views the sale as a strategic move to reduce debt and focus on core businesses.
Investor Concerns
Some investors may worry about the long-term impact on BP's revenue streams from lubricants.
Debt Reduction
BP's Strategy
BP plans to use the proceeds to reduce debt and improve financial flexibility.
Investor Concerns
Investors might prefer dividends or share buybacks over debt reduction.
Key facts
- Company
- BP
- Stake Sold
- 65%
- Buyer
- Stonepeak
- Deal Value
- $6 billion
- Total Valuation
- $10.1 billion
- Accelerated Dividend Payments
- $800 million
- Canada Pension Plan Investment
- $1.05 billion
- BP's Retained Stake
- 35%
- Lock-in Period
- 2 years
- Minority Interest in Castrol India
- 49%
- Other Jurisdictions
- Vietnam, Saudi Arabia, Thailand
- Stonepeak's Assets Under Management
- $80 billion
Timeline
BP triggers Castrol sale, attracting Reliance, Apollo.
BP's AI shift spurs 65% Castrol stake sale.
Stonepeak buys 65% of Castrol for $6B.
Quotes
RBC analysts
Analysts from RBC Capital Markets
“We continue to question the rationale (beyond the headline multiple) of selling this highly cash generative, low volatility and low capital intensity asset, as ultimately this is detrimental to the long term dividend sustainability and earnings quality of the business.”
republicworld.com
“Accelerated dividends now will help reduce debt, but clearly at the expense of medium term cash flows.”
republicworld.com
Sources
BP to sell 65% stake in Castrol to Stonepeak for $6 billion
bp to sell 65% stake in Castrol UK for $10 billion EV
Castrol India shares rise 9% as BP sells majority stake to Stonepeak
Britain's BP To Sell 65% Stake In Castrol To Stonepeak For $6 Billion - Key Insights
