bp has entered into a definitive agreement to sell a 65% stake in Castrol to global investment firm Stonepeak, valuing the business at an enterprise value of $10.1 billion. The transaction follows a detailed strategic review of Castrol and reflects an implied EV to LTM EBITDA multiple of approximately 8.6x, underscoring Castrol’s strong financial performance and future growth prospects.
The sale is a key step in bp’s strategy to streamline its portfolio, strengthen its balance sheet, and sharpen focus on its core downstream and integrated businesses. bp expects to receive net proceeds of around $6.0 billion from the transaction, including approximately $0.8 billion related to the prepayment of future dividend income associated with its retained minority stake. After accounting for joint venture minority interests of about $1.8 billion and other debt-like obligations, Castrol’s implied equity value stands at approximately $8.0 billion.
Upon completion, Castrol will operate as a new joint venture owned 65% by Stonepeak and 35% by bp.bp’s retained interest allows continued participation in Castrol’s growth strategy, which is supported by a track record of nine consecutive quarters of year-on-year earnings growth. After a two-year lock-up period, bp will have the option to divest its remaining stake.
Commenting on the announcement, Carol Howle, interim CEO of bp, said the transaction delivers a strong outcome for all stakeholders. She noted that the sale marks an important milestone in bp’s reset strategy, helping reduce complexity, accelerate execution, and generate cash flow while materially strengthening the balance sheet. The transaction is expected to close by the end of 2026, subject to customary regulatory approvals.
Anthony Borreca, Senior Managing Director and Co-Head of Energy at Stonepeak, said Castrol’s long-standing heritage, global brand strength, and differentiated product portfolio make it a compelling investment. He added that Stonepeak looks forward to working with Castrol’s management team and bp as a minority partner to support the business’s next phase of growth.
The divestment forms part of bp’s previously announced $20 billion asset sale programme. With this transaction, bp has now completed or announced divestments totaling approximately $11 billion. All proceeds will be used to reduce net debt toward bp’s target range of $14–18 billion by the end of 2027.
