BP divests another 8.5% stake in Castrol India
BP announced yesterday that its wholly owned subsidiary, Castrol Limited, has sold a further tranche of the shareholding it holds in Castrol India. Castrol Limited sold 8.5% shareholding held in Castrol India to a range of domestic and international investors. The sale followed a similar sale in May of an 11.5% shareholding in Castrol India.
Castrol India Limited is a public limited company with its corporate office located in Mumbai and regional offices in New Delhi, Kolkata, Mumbai and Chennai. The company manufactures and markets automotive, industrial and marine lubricants distributed through 370+ distributors from more than 80,000 retail outlets. Castrol India Ltd. has three manufacturing plants located in Silvassa, Patalganga and Paharpur.
As a result of the two sales, BP now holds 51% interest in Castrol India. BP, through Castrol Limited, intends to continue as the majority shareholder in Castrol India, the company said.
“BP remains the majority shareholder in Castrol India and we remain committed to long-term investment in India, including both progressing natural gas developments with our partners as well as growing our downstream businesses in the country which include both fuels marketing and lubricants,” said BP Group CEO Bob Dudley.
“Castrol India has grown successfully over decades and, as majority shareholder, BP remains committed to supporting its continued growth,” said Sashi Mukundan, BP’s head of country, India. BP does not expect this transaction to impact staff or customers of Castrol India or its existing contracts.
For the first half of 2016, Castrol India reported a 23% increase in profit from operations to INR549 crores (USD81.7 million) compared to INR446 crores (USD66.4 million) during the same period a year ago. In 2015, profit from operations was up by 25.7% to INR856 crores (USD132 million). Commenting on first-half results, Omer Dormen, managing director of Castrol India, said, “I am particularly satisfied with the overall volume growth of 7% in the first half, which is in line with our expectations and reconfirms that we are on the right track with our strategy and plans.”
“This volume increase is driven by double-digit growth in the personal mobility segment and power brands. We also see a positive trend in the industrial segment where we have grown ahead of the market in our focus categories of metalworking fluids and high-performance products.”
BP is divesting some of its global assets as weak crude oil prices continue to impact negatively on its bottom line. For the quarter ending June, BP Group reported a loss of USD1.4 billion. In the first half of 2016, BP has globally divested assets worth USD1.9 billion, including the partial sale of its interest in Castrol India in May.