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Goldman Sachs, UBS to Lead $3.75B Cross-Border Loans, High-Yield Bonds for Stonepeak’s $10B Majority Interest in Castrol From BP
Goldman Sachs and UBS are leading a $3.75 billion cross-border leveraged loan and high-yield bond package to finance Stonepeak’s majority interest in Castrol from BP, valuing the oil lubricant brand at $10.1 billion, according to sources.
Castrol’s $3.75 billion offering will be structured in term loan Bs and high-yield bonds denominated in both U.S. dollars and euros, according to sources. The deal is expected to launch in late March or early April, the source added, depending on Castrol’s year-end financials. A revolving credit facility is also expected as part of the deal, according to a source close to the transaction.
U.K. oil and gas company BP will retain a 35% minority interest in Castrol as part of the transaction, according to a press release. In connection with the deal, Canada Pension Plan Investment Board will invest up to $1.05 billion. The transaction is expected to close by the end of 2026. Simpson Thacher and DLA Piper served as legal counsel, Paul Weiss served as financing counsel, and UBS served as financial advisor to Stonepeak. Latham & Watkins represented the financing sources in the transaction, according to a release.
The debt financing for Castrol indicates a 4.5x to 5x leverage, as reported. Sell-side advisor Goldman Sachs was marketing the unit off 2025 EBITDA of $1.2 billion, targeting a valuation of $10 billion, as reported.
BP said in February 2025 it was reviewing Castrol as part of a plan to raise $20 billion by 2027 via asset sales to reduce its debt.
Castrol’s deal is among a handful of deals on the forward calendar in the primary market financing M&A activity, including $20 billion in debt financing lined up for EA’s acquisition by Silver Lake as well as $8 billion in debt financing for Sealed Air’s acquisition by CD&R.
To kick off 2026, leveraged finance dealmakers have been successful in selling off billions of dollars in debt funding M&A and LBO activity, highlighting strong buy-sider appetite for new-money transactions following a relatively lackluster 2025, as reported.
Stonepeak declined to comment. Goldman Sachs, UBS, Castrol and BP did not respond to requests for comment.
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