Lubricants giant Valvoline sells core business to Saudi Aramco
Valvoline’s global products business fits perfectly within Aramco’s growth strategy for lubricants, a spokesperson said
Oil giant Saudi Aramco has agreed to acquire Nasdaq-listed Valvoline Inc’s global products unit for US$2.65bn. The Saudi firm – whose capital value on the KSA Tadawul exceeds US $4tn – recently announced that its growth strategy includes further development of the lubricants division, and here, has focused on a household-name brand with a leading international reputation.
Valvoline Inc is a worldwide marketer and supplier of premium branded lubricants and automotive services, with sales in more than 140 countries. Established in 1866, the company’s heritage spans 156 years, during which time it has developed brand recognition across multiple product and service channels. Valvoline ranks globally as the number 3 passenger car motor oil brand in the DIY market by volume and in the United States operates and franchises no fewer than 1,400 quick-lube locations.
In October 2021, experts gathered at Valvoline’s headquarters in Dubai to discuss some of the key issues transforming the transport sector – one of the key takeaways was to avoid focusing on cost cutting.
Mohammed Y. Al Qahtani, Aramco Senior Vice President of Downstream said Valvoline’s global products business fits perfectly with Aramco’s growth strategy for lubricants “as it will leverage our global base oils production, contribute to our R&D capabilities and strengthen our existing relationships with OEMs”.
The transaction is still subject to customary adjustments set forth in the equity purchase agreement, Aramco said.
Diversification into the lubricants DIY market is a declared core strategy for Saudi Aramco, so far spending in excess of $250bn in R&D initiatives to develop market-leading energy alternatives to its previously core role as a fossil fuel producer.
In November 2021, Aramco awarded EPC contracts worth $10bn for the vast Jafurah field development, while in December 2021, Samsung Engineering said it won a $1.2bn Aramco contract for Jafurah Gas Process Package 1.
