BP Completes Castrol Sale to Stonepeak With $6 Billion After-Tax Proceeds

bp has completed the sale of a 65% stake in Castrol to Stonepeak, bp announced on 2 November 2026, with the London-based energy group receiving $6 billion in after-tax proceeds that it said it is using to further reduce financial obligations, in line with its stated first priority of strengthening the balance sheet.

Castrol now operates as a standalone company with its own management, governance and strategic priorities, while bp retains a 35% stake in the business. “This deal brings meaningful cash proceeds to bp today while retaining a valuable stake in Castrol’s future growth,” said bp CEO Meg O’Neill. Castrol CEO Michelle Jou said the business begins the next part of its journey “from a position of real strength, with trusted brands, strong customer relationships, talented colleagues and a clear strategy for growth.”

Proceeds and Retained Stake

The $6 billion after-tax total includes around $0.8 billion relating to the pre-payment of future dividend income over the short to medium term on bp’s retained stake, together with other customary transaction adjustments. bp will treat the retained stake as an equity-accounted investment and does not expect to recognize earnings or receive a dividend from it in the short to medium term, with Stonepeak holding a preference on distributions. Following a two-year lock-up period, bp has optionality to sell its 35% stake.

The transaction includes minority interests in Castrol, principally in India (49% interest), Vietnam (35%), Saudi Arabia (50%), Thailand (40%) and other jurisdictions. Castrol’s non-controlling interests’ share of net income averaged around $100 million per annum over 2019 to 2025, according to bp. On bp’s balance sheet, those non-controlling interests, measured at historic cost, are recognized at around $0.45 billion, and Castrol’s debt-like obligations at around $0.3 billion, in each case as at 30 September 2026.

Terms Agreed in December 2025

bp agreed the sale on 24 December 2025 following a comprehensive strategic review of Castrol, at an enterprise value of $10.1 billion that the company said represented an implied EV/LTM EBITDA of around 8.6x. The implied total equity value of Castrol was $8.0 billion after deducting joint-venture minority interests totaling $1.8 billion and other debt-like obligations of around $0.3 billion, with a significant proportion of the minority interests relating to the shareholding in publicly listed Castrol India Limited (CASTROLIND.BO ). bp said at the time that its retained stake would provide exposure to Castrol’s growth plan, built on nine quarters of consecutive year-on-year earnings growth, and that it would appoint two seats to the board of the new joint venture.

The sale is part of bp’s previously announced $20 billion divestment programme and brought completed and announced divestment proceeds to around $11.0 billion at the December announcement. Carol Howle, bp’s interim CEO at the time, said the company had completed or announced over half of its targeted programme. All proceeds from the transaction were to be allocated to reducing net debt toward its target of between $14 billion and $18 billion by end 2027; net debt stood at $26.1 billion at the end of the third quarter of 2025.

CPP Investments will invest up to $1.05 billion in support of the transaction, resulting in an indirect stake in Castrol, according to Stonepeak’s announcement, which also named UBS as Stonepeak’s financial advisor. Castrol manufactures and markets engine oils, industrial fluids and greases through approximately 20 blending plants and more than 100 third-party facilities and warehouses across 150 countries.

A mandatory tender offer to public shareholders of Castrol India Limited was also announced in accordance with the Indian takeover code, with UBS Securities India Private Limited acting as manager of the offer. Stonepeak said the tender offer would be proceeded with only upon completion of the Castrol transaction.