ExxonMobil Acquired - European Fuels Business
BP Amoco PLC
7 December 1999
BP AMOCO BUYS EXXONMOBIL FUELS BUSINESS IN EUROPE
BP Amoco p.l.c. and ExxonMobil Corporation announced today that they have
mutually agreed on the principles under which they will dissolve the BP-Mobil
European fuels and lubricants joint venture in response to the European
Commission's authorisation of the Exxon and Mobil merger.
Under the agreement - which is subject to a number of approvals and
appropriate employee consultation - BP Amoco will purchase Mobil's 30 per cent
interest in the fuels business for about $1.5 billion, subject to adjustments.
The agreement also includes the transfer of Mobil's interests in certain
pipelines serving Gatwick airport. In addition, the two companies will divide
the assets of the lubricants business broadly in line with their equity stakes
(51 per cent Mobil, 49 per cent BP Amoco).
'It took a significant amount of dedication and effort on the parts of BP and
Mobil employees to develop and then make this joint venture a success.
However, in this highly competitive industry BP Amoco and ExxonMobil have each
found new opportunities for the next century. This required us to bring the
venture to a mutually beneficial close,' said BP Amoco Chief Executive Sir
John Browne and ExxonMobil Chairman and Chief Executive Officer Lee Raymond.
'We will end our relationship in a way that brings fair value to both
companies for the assets involved and allows both of us to continue to provide
our customers with high-quality products and service.'
The fuels part of the venture, operated by BP Amoco, currently operates around
8,500 service stations across Europe, representing about 12 per cent of the
market, while the lubricants part of the venture, operated by ExxonMobil, has
a market share of just over 18 per cent in Europe.
Under the outline agreement announced today, BP Amoco will receive the service
stations and other marketing assets together with the fuels refineries at
Grangemouth and Coryton, UK; Lavera, France; Nerefco, The Netherlands; and
Castellon, Spain; as well as the shareholdings in the Turkish Mersin, French
Reichstett and German Bayernoil refineries. Mobil will receive the fuels
refinery at Gravenchon.
On the lubricants side, ExxonMobil will receive the Dunkirk refinery in France
and the lubricants leg at Gravenchon. BP Amoco will retain the base oil
refinery in Neuhof, Germany and the lubricants leg of Coryton, together with
the blending plants at Neuhof; Ghent in Belgium; Gemlik in Turkey; Batsons in
the UK; Drapetsona in Greece; and a 45 per cent share of the Turkish
Serviburnu plant. The remaining 10 lubricant blending plants will be part of
the ExxonMobil portfolio.
The companies have also agreed in principle to the following general
provisions for the marketing of lubricants in Europe. BP Amoco will receive:
-All the lubricant marketing businesses in Portugal, Spain, Greece, Gibraltar
and Malta, including the business currently branded as Mobil and the Mobil
brand for an interim period,
-All the direct commercial vehicle lubricants business throughout Europe,
including the business currently branded as Mobil and the Mobil brand for an
interim period,
-All the BP and Duckhams branded passenger vehicle lubricant business
throughout Europe, and
-All distributor relationships associated with the BP and Duckhams brands.
ExxonMobil will receive: (outside of Portugal, Spain, Greece, Gibraltar and
Malta)
-All the direct industrial lubricants businesses, including the BP and
Duckhams branded businesses,
-All the Mobil-branded passenger vehicle lubricants business, and
-All distributor relationships associated with the Mobil brand.
ExxonMobil and BP Amoco said that they do not expect the termination of the
joint venture to have a significant direct impact on staffing levels.
Assuming that all the necessary approvals are received, the economic effective
date for the implementation of the final agreement, will be January 1, 2000.
Notes to Editors:
Under the European joint venture, announced in February 1996, BP and Mobil
combined their downstream assets establishing operating partnerships for fuels
and for lubricants in each country where the companies were active.
The joint venture excluded the operations of both companies which had
activities in Europe but operated globally, such as international trading,
aviation, marine, shipping and gas marketing. Exploration and production and
chemicals were also excluded.
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