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News Topical, Digital Desk : Big Deal News: Castrol India shares have seen a sharp rise. The company's shares rose more than 8% on Wednesday. This surge comes after parent company British Petroleum (BP) announced plans to sell its 65% stake in Castrol. The deal was struck with infrastructure investment firm Stonepeak and values Castrol's enterprise value at approximately $10 billion.
BP stated that the sale of its 65% stake in this transaction will generate net proceeds of approximately $6 billion, including accelerated dividend payments. The company clarified that the entire proceeds will be used to reduce debt. BP aims to reduce its net debt to a range of $14–18 billion by the end of 2027. As of the end of the September quarter (Q3 2025), BP's net debt was $26.1 billion.
This transaction follows Castrol's strategic review. The deal values Castrol at an enterprise value of $10.1 billion, representing a valuation of approximately 8.6 times based on LTM EBITDA. According to BP, the deal will strengthen its balance sheet, simplify its portfolio, and support its strategy to focus on downstream businesses. By the end of the September quarter , more than 500,000 retail investors had sold a 51% stake in its parent Castrol Indian unit. Life Insurance Corporation of India (LIC) holds a 10% stake in Castrol India, while the Government of Singapore holds a 1.33% stake. Furthermore, over 500,000 small retail investors (with authorised share capital of up to ₹2 lakh) hold 16.6% of the company. The current deal is expected to close by the end of 2026, subject to regulatory approvals. Following the completion of the deal, a new joint venture will be formed between Stonepeak (65%) and BP (35%), allowing BP to retain a stake in Castrol's growth plans. BP will have the option to sell its remaining 35% stake after a two-year lock-in period. BP's 'reset strategy' BP's interim CEO Carol Howle described the deal as a "very positive outcome" for all stakeholders. He said the sale represents a key milestone in BP's "reset strategy," which involves reducing complexity, increasing focus on downstream businesses, and improving cash flow and returns for shareholders. The deal also includes the acquisition of several minority stakes in Castrol, including in India (49%), Vietnam (35%), Saudi Arabia (50%), Thailand (40%), and other regions.
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