February 19, 2025 08:23 GMT
ENERGY SECTOR: BP Considers Lubricants Sale; Investors To Resist Climate Stra
ENERGY SECTOR
BPLN A1/A-/A+ Spreads Muted
The unit accounts for <3% of EBITDA was previously floated as a candidate for divestment. The shareholder group resisting a shift in climate strategy is expected and relatively small (2.5% of equity vs. Elliott’s ~5%) so we don’t think this changes much with focus remaining on the 26 Feb CMD.
- BBG sources report that BP is considering sale of lubricants unit (Castrol), valued at USD 8bn–10bn. The unit is reportedly one of the assets that Elliott has identified for potential disposal. FY24 adj-EBITDA was USD 1bn with CapEx of USD 0.2bn (vs. USD 38bn and USD 16.2bn for the group).
- Separately, the FT is reporting on 48 institutional investors holding 2.5% of BP shares calling on BP to allow a s/h vote on any moves to reverse climate goals.
- “BP has previously offered a shareholder vote on its transition strategy and we expect a similar level of accountability to be maintained for future material strategy changes”
- The strategy including a commitment to cut oil/gas output by 25% by 2030 was backed by 88% of investors in 2022. Group includes Rathbones, Phoenix Group, Robeco and Royal London.
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