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BP has struck a $6 billion deal to divest a controlling interest in its lubricants business Castrol to a US investment firm.
Details of the Major Deal
The oil giant sold a 65 percent share in Castrol, which makes oils for cars, motorcycles and industrial vehicles, to the New York firm Stonepeak.
This transaction valued Castrol at $10.1 billion, with BP receiving $6 billion cash, which it will use to pay down debt and enable it to concentrate on its primary operations.
BP will retain a 35% stake in Castrol, which it originally acquired in the year 2000.
Strategic Shift and Asset Sales
The UK-headquartered energy corporation stated the sale is a "milestone" in its plans to overhaul its business and strip out costs.
BP in February announced plans to sell off $20 billion worth of assets in a bid to focus on its core crude oil and gas business and strengthen its financial position.
After this latest agreement and earlier disclosures, the company states it is more than halfway to achieving that goal.
It is also shifting its strategy away from investment in renewable power and refocusing on its emphasis on fossil fuels following pressure from some investors who were frustrated that its earnings and stock value had lagged behind competitors.
Sector Context and Leadership Changes
Competitors like Shell and Norway's Equinor have also scaled back plans to invest in renewables.
The Castrol sale comes a week after BP announced its first female chief executive, Meg O'Neill, who will assume leadership in April 2026.
Her surprise appointment came only three months after BP named a new chairman, Albert Manifold.
And she was given the CEO role less than two years after Murray Auchincloss succeeded Bernard Looney as chief executive.
Ongoing Business Streamlining
This recent transaction is the most recent in a line of sales by the firm, which included offloading its US onshore wind energy business and its Dutch mobility and convenience arm.
Acting CEO Carol Howle commented the sale is a "excellent result for all stakeholders".
"We are reducing complexity, focusing the downstream on our core integrated operations, and speeding up the execution of our strategy," she stated.
