BP agreed to sell its aviation turbine oil business assets to Eastman Chemical Co. for an undisclosed amount, both companies announced last week.
The deal, expected to close in the second quarter of 2014, includes BPs aviation turbine oil manufacturing, blending and packaging operations in Linden, New Jersey, United States. Eastman will also acquire BPs aviation oil product formulations and customer contracts, which include long-term deals with global commercial airlines.
Kingsport, Tennessee, U.S.-based Eastman Chemical will integrate the aviation oil business into its specialty fluids and intermediates segment, the company said in a Jan. 28 press release. The aviation turbine oils will complement its Skydrol brand of aviation hydraulic fluids, which the company added to its portfolio in 2012 when it acquired Solutia for U.S. $4.7 billion. Eastman also produces chemicals that are used as additives for synthetic lubricants.
Eastman anticipates that BPs aviation oil business assets will be worth approximately $100 million in annual revenue and will surpass the purchase costs by the end of the 2014 fiscal year.
BP decided to divest its aviation oils segment after review of its entire lubricants portfolio, saidIain Conn, the companys chief executive for refining and marketing, in yesterdays press statement. Conn added that the sale will allow it to focus on investments in other industry sectors. BP will still be involved in the global aviation fuels business through its subsidiary, Air BP.
Eastman told Lube Report Asia that it is committed to maintaining the global nature of the turbine oils business and will supply those products through the Skydrol network.