BP Sells 65% Stake in Castrol for $10 Billion to Stonepeak
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Source: NASDAQ.COM
- Large Transaction: BP has agreed to sell a 65% stake in lubricants maker Castrol to Stonepeak for an enterprise value of $10 billion, with an implied total equity value of $8 billion, indicating BP's proactive asset restructuring strategy.
- Debt Reduction Plan: The transaction is expected to yield around $6 billion in net proceeds for BP, including accelerated dividend payments, aimed at reducing net debt to a target range of $14-18 billion by the end of 2027, significantly improving its financial health.
- Strategic Restructuring Progress: Following the completion or announcement of over $20 billion in divestitures, BP continues to focus on its core businesses by reducing complexity, which enhances cash flow and returns, demonstrating the company's commitment to its reset strategy.
- Future Growth Potential: By retaining a 35% stake in Castrol, BP ensures continued exposure to Castrol's growth plans over the coming years while securing two board seats in the new joint venture, further solidifying its influence in the lubricants market.
BP
$34.58+Infinity%1D
Analyst Views on BP
Wall Street analysts forecast BP stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for BP is 35.90 USD with a low forecast of 6.29 USD and a high forecast of 44.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
10 Analyst Rating
6 Buy
4 Hold
0 Sell
Moderate Buy
Current: 34.140
Low
6.29
Averages
35.90
High
44.00
Current: 34.140
Low
6.29
Averages
35.90
High
44.00
About BP
BP p.l.c. is a United Kingdom-based integrated energy company. Its segments include Gas & low carbon energy, Oil production & operations, Customers & products, and Other businesses & corporate. The gas & low carbon energy comprises regions with upstream businesses that predominantly produce natural gas, gas marketing and trading activities and its solar, wind and hydrogen businesses. The oil production & operations segment comprises regions with upstream activities that predominantly produce crude oil, including bpx energy. The customers & products segment comprises its customer-focused businesses, which include convenience and retail fuels, electric vehicle (EV) charging, as well as Castrol, aviation and business-to-business (B2B) and midstream. It also includes its products businesses, refining and oil trading, as well as its bioenergy businesses. The other businesses and corporate also comprises the Company's shipping and treasury functions, and corporate activities worldwide.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
