CCP clears acquisition of BP’s global Castrol lubricants business

ISLAMABAD: The Competition Commission of Pakistan (CCP) has approved the Pakistan leg of Stonepeak’s acquisition of BP’s global Castrol lubricants business, clearing a transaction that forms part of one of the oil major’s biggest strategic divestments in recent years.

The approval, granted after a Phase-I review, covers the transaction’s competition implications in Pakistan, where Castrol lubricants are marketed through Castrol Group Holdings Limited.

The global deal, announced by BP in December last year, values the Castrol business at an enterprise value of approximately USD10.1 billion. Under the transaction, U.S.-based infrastructure investment firm Stonepeak will acquire a controlling stake in Castrol, while Canada Pension Plan Investment Board (CPP Investments) will acquire an indirect minority interest. BP will retain an indirect minority stake in the business following completion.

According to the CCP’s merger order, the Commission identified the relevant market as the sale of lubricants in Pakistan and concluded that the transaction would not substantially lessen competition or create or strengthen a dominant position.

The Commission found that neither Stonepeak nor CPP Investments has existing operations in Pakistan’s lubricants market. Consequently, the acquisition does not combine competing businesses in Pakistan, resulting in no horizontal or vertical overlap with Castrol’s local operations.

The regulator also observed that Castrol’s lubricants business in Pakistan is conducted through a third-party distributor, and the change in ownership will not alter the structure of the domestic lubricants market.

The acquisition forms part of BP’s broader strategy to reshape its global portfolio and strengthen its balance sheet through major asset divestments. BP announced that proceeds from the transaction will primarily be used to reduce debt while allowing the company to retain exposure to Castrol’s future growth through its remaining stake.

Internationally, Castrol is among the world’s largest lubricants brands, serving automotive, industrial, marine and commercial customers across more than 150 countries. Besides its traditional lubricant business, the company has also been expanding into advanced thermal management fluids for electric vehicles and data centres, reflecting changing global demand for specialised cooling technologies.

Under Pakistan’s merger control regime, acquisitions involving businesses with operations in Pakistan require CCP’s approval irrespective of where the transaction originates. The Commission reviews such transactions to ensure they do not substantially lessen competition or result in the creation or strengthening of a dominant position in the relevant market.

The Commission authorised the acquisition under Section 31 of the Competition Act, 2010, concluding that the transaction raises no competition concerns in Pakistan.

Copyright Business Recorder, 2026