BP completes Castrol lubricants unit sale to Stonepeak

BP Plc completed a deal to offload its Castrol lubricants business, giving the oil and gas major $6 billion to pay down debt as it works to repair the balance sheet. BP agreed at the end of last year to sell a 65% stake in Castrol to U.S. investment firm Stonepeak Partners, marking a key milestone in the company’s efforts to reset its business after years of underperformance. The firm is channeling excess cash toward reducing financial obligations, which include conventional debt, hybrid bonds, leases and settlement payments for the Deepwater Horizon disaster. Net debt totaled $13.87 billion at the end of the third quarter, BP said last week as it reported bumper earnings. “This deal brings meaningful cash proceeds to BP today while retaining a valuable stake in Castrol’s future growth,” CEO Meg O’Neill said in a statement on Nov. 2. “It will now have greater independence to accelerate its next phase of delivery.” BP has completed a series of disposals as it attempts to simplify its business, focusing investment on its core upstream, downstream and trading operations. O’Neill, who in April became the first outsider to take the helm, is preparing to lay out her long-term strategy in December.

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