French supermajor Total is selling off its fuel marketing operations in Italy.
The company has signed an agreement with the Italian Group API to sell their fuel marketing and refining assets in the TotalErg joint venture (Erg 51%, Total 49%).
Following the divestment of the LPG and Commercial Sales businesses, this third transaction completes the sale of all TotalErg’s assets, for a total amount of around €750 million.
Total is instead reinforcing its lubricants business in Italy by buying out Erg’s 51% stake in the lubricants activities of the joint venture that will consequently be terminated.
Created in 2010 by merging the Total and Erg activities, TotalErg is the fourth-largest fuel marketer in Italy.
However the fragmented market was not in line with the group’s expectations despite the joint efforts of the two shareholders.
The lubricants market, however, does offer satisfactory growth perspectives and this consolidation is in line with the Group strategy in this business sector, the firm said in a statement.
“The successful monetization of these mature activities in a challenging market is another example of our active portfolio management strategy in Marketing & Services. It also helps reduce our refining capacity in Europe while taking advantage of a favorable market,” said Momar Nguer, President, Marketing & Services.
“The buyout from Erg of the lubricants activity allows us to focus and expand this high-return business. In addition, we will maintain our presence in the truck refueling business in Italy with our European network AS24, as well as in aviation fuels.”
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