Philips 66 Cedes Control of Jet Fuel Stations in Germany and Austria to Financial Investors for $2.8 Billion
American organization enhances jet fueling stations with silver plating
Eager to streamline its operations and boost long-term returns for investors, U.S. oil behemoth Philips 66 is peddling a substantial portion of its Jet-labeled fuel stations in Germany and Austria to financial heavyweights. The company is offloading an impressive 65% majority stake worth approximately $2.8 billion, to consortiums backed by investment firms Energy Equation Partners and Stonepeak.
This significant deal includes the transfer of 843 stations branded under the Jet name, which will continue to source fuel from Philips 66's MiRO refinery based in Karlsruhe. The remaining 35% stake will be retained by Philips 66, albeit at an arm's length through a new joint venture, Carrera LP.
The proceeds drawn from this sale will be allocated towards debt reduction and rewarding dividends to shareholders. The announcement of the deal was prelude to Philips 66's annual general meeting, where the composition of the supervisory board, among other matters, will be subject to a vote.
Critics from TD Cowen, an investment firm, have expressed disapproval over Philips 66's decision to not liquidate all stations. The company's stock reported a 1% drop in value to $123.57 in the wake of the announcement.
Phillips 66 is currently under intense pressure from another investment firm, Elliott, which champions bringing structural changes such as divesting business units.
Other oil giants have jettisoned their German fuel station networks in recent years. In 2017, ExxonMobil's Esso stations were snapped up by the UK-based EG Group, while OMV's stations found new ownership in 2022. More recently, in 2023, Canada's Alimentation caught hold of TotalEnergies' Total stations in Germany and the Netherlands in a deal valued at around $3.3 billion.
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- Despite selling a substantial portion of its Jet-labeled fuel stations in Germany and Austria to financial investors, Philips 66 plans to continue operations in the energy sector, with the proceeds being allocated towards debt reduction and rewarding dividends to shareholders.
- The transfer of Philips 66's Jet fuel stations to financial investors such as Energy Equation Partners and Stonepeak, industry peers have noted, could signify a broader trend in the oil industry, where companies are adapting their policies (community policy, employment policy) in response to pressure from investment firms like Elliott.
