CCP gives nod to BP plc’s Castrol ownership change

The Competition Commission of Pakistan (CCP) has approved the proposed acquisition of BP plc’s global Castrol lubricants business by Motion JVCo Limited, a special purpose vehicle established by US-based investment firm Stonepeak Partners, after its Phase-I review.

According to a statement released on Thursday, Castrol lubricants are marketed and sold in Pakistan through Castrol Group Holdings Limited.

“Notwithstanding the fact that the transaction is global, under Pakistan’s merger control law, acquisitions involving businesses with operations in Pakistan are reviewed to ensure they do not substantially lessen competition or create or strengthen a dominant position in the relevant market,” said CCP.

Under the transaction, BP plc will sell Castrol Group Holdings Limited, which owns the global Castrol lubricants business, to Motion JVCo.

Canada Pension Plan Investment Board (CPP Investments), through its wholly owned subsidiary, will acquire an indirect minority stake, while Stonepeak will retain indirect sole control following completion.

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CCP identified the relevant market as the sale of lubricants in Pakistan.

The commission found that neither Stonepeak nor CPP Investments has existing operations in Pakistan’s lubricants market. As a result, the transaction does not combine competing businesses in Pakistan and creates no horizontal or vertical overlap with the target’s operations, it said.

The Commission concluded that the acquisition would not alter the market structure, create entry barriers, or result in the creation or strengthening of a dominant position in Pakistan’s lubricants market. Accordingly, it authorised the transaction under Section 31(1)(d)(i) of the Competition Act, 2010.

The Commission’s approval is confined to its competition assessment under the Competition Act, 2010. CCP said that the transaction remains subject to all other applicable legal and regulatory requirements.