The Competition Commission of Pakistan (CCP) has approved the proposed acquisition of BP plc’s global Castrol lubricants business by Motion JVCo Limited, a special purpose vehicle established by United States-based investment firm Stonepeak Partners. The approval was granted after the Commission completed its Phase I merger review and concluded that the transaction would not substantially reduce competition within Pakistan’s lubricants market.
Although the acquisition is part of a global corporate transaction, the Competition Commission reviewed the deal because Castrol products are actively marketed and sold in Pakistan through Castrol Group Holdings Limited. Under Pakistan’s merger control framework, acquisitions involving businesses with commercial operations or market presence in the country must be assessed to determine whether they could significantly affect market competition or create anti-competitive conditions.
Under the agreement, BP plc will transfer ownership of Castrol Group Holdings Limited, which controls the global Castrol lubricants business, to Motion JVCo Limited. Following completion of the transaction, Stonepeak Partners will obtain indirect sole control of the business. At the same time, Canada Pension Plan Investment Board (CPP Investments) will acquire an indirect minority interest through one of its wholly owned subsidiaries as part of the investment structure supporting the acquisition.
As part of its assessment, the Competition Commission identified the sale of lubricants in Pakistan as the relevant market for evaluating the transaction. The Commission examined whether the acquisition would result in reduced competition, strengthen a dominant market position or create barriers for other businesses operating in the lubricants sector.
According to the Commission’s findings, neither Stonepeak Partners nor CPP Investments currently operates in Pakistan’s lubricants market. Since neither investor competes directly with Castrol’s existing business in the country, the acquisition does not combine competing businesses within the local market. The Commission also found that the transaction creates no horizontal overlap between competing firms or vertical integration that could negatively affect competition. Castrol lubricants will continue to be marketed in Pakistan through its existing third-party distribution arrangements.
Based on its analysis, the Competition Commission concluded that the acquisition would not alter the existing market structure, reduce competitive conditions or strengthen a dominant position within Pakistan’s lubricants industry. As a result, the transaction was authorised under Section 31(1)(d)(i) of the Competition Act, 2010, allowing the acquisition to proceed from a competition law perspective.
The Commission also clarified that its approval applies only to matters falling within the scope of the Competition Act, 2010. The acquiring parties will still be required to comply with all other applicable legal, corporate and regulatory requirements before the global transaction can be fully completed. This includes any approvals or obligations required under other jurisdictions where the companies operate.
The approval highlights the Competition Commission’s role in evaluating international mergers involving companies with business interests in Pakistan while ensuring that local markets remain competitive. The regulator stated that its merger review framework is intended to facilitate investment, corporate restructuring and mergers and acquisitions without compromising fair competition. By maintaining a transparent review process, the Commission aims to strengthen investor confidence, encourage foreign direct investment and support a competitive business environment for companies operating in Pakistan.
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