BP has completed the sale of a 65 percent stake in Castrol, its lubricants business, to infrastructure investor Stonepeak, the companies said on Monday. BP will use the $6 billion of after-tax proceeds to reduce its financial obligations, and it retains the remaining 35 percent in a new joint venture, which it will account for as an equity investment and may sell after a two-year lock-up.
The proceeds figure needs care. The $6 billion is an after-tax amount and includes an estimated $0.8 billion paid in advance for future dividend income on the 35 percent BP keeps, together with other customary adjustments. At signing on December 24, 2025, the deal valued Castrol at a $10.1 billion enterprise value, an estimated 8.6 times trailing twelve-month EBITDA, and an implied equity value of $8.0 billion after deducting joint venture minority interests and debt-like items. On those signing terms, the 65 percent stake itself represents about $5.2 billion of equity value. BP also said it does not expect earnings or dividends from the retained stake in the short to medium term, because Stonepeak holds a preference on distributions. Canada’s CPP Investments is an indirect minority investor alongside Stonepeak.
Castrol now operates as a standalone company with its own management and governance. Stonepeak has installed former Shell chief executive Ben van Beurden, currently chairman of Clariant, as chairman of Castrol’s board. The transaction perimeter includes Castrol’s minority interests in several markets, among them India at 49 percent, Vietnam at 35 percent, Saudi Arabia at 50 percent and Thailand at 40 percent.
For BP, the closing is the centrepiece of its balance sheet reset. Net debt stood at $13.9 billion at the end of the third quarter, and chief executive Meg O’Neill has made debt reduction the first call on disposal proceeds. For Stonepeak, which reports about $98 billion of assets under management, Castrol is a bet that a global lubricants brand with pricing power and cash generation behaves like infrastructure even though it sits downstream of the oil business it came from.