24 December 2025
If you are covering the news that BP will sell its majority stake in Castrol to Stonepeak, please see the following comment from Maurizio Carulli, global energy and materials analyst at Quilter Cheviot:
“In a significant pre-Christmas move, BP, which has market cap of £65bn, has agreed to sell a 65% majority stake in its world-renowned lubricant business, Castrol, to US private equity firm Stonepeak. This transaction represents a positive step forward for BP, reinforcing its ongoing ‘strategy reset’ and the aim to reduce its net debt and refocus its downstream business.
“Throughout 2025, BP has made notable progress in implementing value-enhancing initiatives, strengthening its board and streamlining its business. Albert Manifold, who was appointed as Chair in October, brought a proven track record of delivering shareholder returns during his tenure as CEO of global building materials giant CRH. BP is also set to welcome Meg O’Neill as CEO in April next year - the first CEO selected from outside of BP’s ranks in the company’s century-long history. O’Neill is expected to accelerate the refocus of BP’s strategy, which was successfully initiated by former CEO Murray Auchincloss.
“The implied sale price of $10bn EV and $8bn equity value, for 100% of the company, means BP is expected to receive around $6bn from the sale upon completion, with the proceeds set to be used solely to reduce net debt. The implied valuation is broadly in line with expectations, at 8.6x EV/EBITDA. While the hope was originally for a 100% sale rather than 65%, following a two-year lock-up period, BP will have the optionality to sell its remaining 35% stake.
“With this transaction, BP has now announced or executed around $11bn of divestments of the $20bn target it set out to achieve by the end of 2027.”
