New Delhi, Dec 24 (NationPress) BP has officially declared its decision to divest a 65 percent stake in its lubricant division, Castrol, to the international investment firm Stonepeak for approximately $6 billion. This agreement values Castrol at nearly $10.1 billion, factoring in debt. Following this arrangement, BP will maintain a minority stake in Castrol through a joint venture framework.

After the announcement, shares of Castrol India experienced a notable rise of about 8 percent during early trading, with shares priced at approximately Rs 201 each.

BP confirmed that the full proceeds from this sale will be allocated to decrease its net debt, aligning with the company's objective of reducing debt to $14–18 billion by the conclusion of 2027.

As of the end of the third quarter in 2025, BP's net debt was recorded at $26.1 billion. This agreement also encompasses BP's minority interests in Castrol across various nations.

These nations include India, where Castrol holds a 49 percent minority interest, as well as Vietnam with 35 percent, Saudi Arabia with 50 percent, Thailand with 40 percent, and shares in other markets.

Upon completion of the transaction, BP will have the right to appoint two board members to the newly established joint venture.

Stonepeak disclosed that Canada's pension fund, CPPIB, plans to invest up to $1.05 billion as part of this agreement.

Market data indicates that Castrol owned a 51 percent stake in Castrol India as of the end of September.

This sale is a significant component of BP's larger strategy to divest $20 billion in assets by the end of 2027.

The company has been offloading assets to address prolonged underperformance, which attracted criticism from activist investor Elliott Investment Management.

In a statement, BP highlighted that the implied total equity value of Castrol is approximately $8 billion after adjusting for joint venture minority interests of $1.8 billion and additional debt-like obligations of around $0.3 billion.

Carol Howle, interim CEO of BP, remarked that this transaction is a beneficial outcome for all stakeholders involved.

“This transaction enables us to realize value for our shareholders, generating significant proceeds while still benefiting from Castrol’s robust growth trajectory,” Howle stated.

Anthony Borreca, Senior Managing Director and Co-Head of Energy at Stonepeak, commented: “Lubricants are essential products necessary for the safe and efficient operation of nearly every vehicle, machine, and industrial process globally.”