Finance
Saudi Aramco exploring initial bid for BP's Castrol unit, source says
Published by Global Banking and Finance Review
Posted on March 5, 2025
Global Banking and Finance Review
Company
Global Banking and Finance Review is an online platform offering news, analysis, and opinion on the latest trends, developments, and innovations in the banking and finance industry worldwide. The platform covers a diverse range of topics, including banking, insurance, investment, wealth management, fintech, and regulatory issues. The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.
Published by Global Banking and Finance Review
Posted on March 5, 2025
(Reuters) -Saudi Aramco is in the early stages of considering a potential bid for BP's lubricant business Castrol, according to a person with knowledge of the matter.
BP has been exploring all options around its Castrol business, including a possible sale, as part of a strategic review.
The business would be expected to be worth around $6 billion to $8 billion, Ashley Kelty, an analyst at Panmure Liberum, said in a note last week.
BP and Aramco declined to comment.
BP shares were down 0.1% by 1606 GMT.
Bloomberg News was first to report about Aramco's interest in Castrol on Wednesday, which comes a day after the Saudi oil giant reported a drop in its annual profit and signalled it will slash its dividend payouts by nearly a third this year.
BP said last week it was reviewing its lubricants business, Castrol, and targeting $20 billion in divestments by 2027.
The divestment programme is a key part of CEO Murray Auchincloss' strategy revamp to slash spending on renewables and increase BP's focus on oil and gas production to enhance earnings.
BP, which has underperformed peers like Shell and Exxon, has come under increasing pressure to change strategy after news that U.S. activist investor Elliott Investment Management has built a 5% stake in the company.
According to Elliott, BP would benefit from selling its Castrol lubricants and its network of service stations to unlock value and boost share buybacks, a source told Reuters last week.
Bloomberg's report said Aramco hasn't made a final decision on the structure of a potential bid for Castrol or whether it will proceed as deliberations are still in the early stage.
(Reporting by Pushkala Aripaka, Prerna Bedi Shanima A in Bengaluru and Arunima Kumar in MumbaiEditing by Leroy Leo, Frances Kerry and Emelia Sithole-Matarise)