Apollo Funds will become a non-controlling shareholder of bp Pipelines TAP Limited, an entity that owns a 20% stake in Trans Adriatic Pipeline AG.
bp today announced an agreement for funds managed by Apollo to acquire a non-controlling stake in bp Pipelines TAP Limited, the bp subsidiary that owns a 20% stake in Trans Adriatic Pipeline AG (TAP) in a transaction valued at approximately $1 billion. Upon completion of the agreement, bp will remain the controlling shareholder of bp Pipelines TAP Limited.
Trans Adriatic Pipeline AG is the owner and operator of a key infrastructure asset to meet European energy demand: the final 880-kilometer stretch of the Southern Gas Corridor pipeline system that transports natural gas from the BP-operated Shah Deniz gas field in the Azerbaijani sector of the Caspian Sea to markets in Europe such as Greece and Italy.
BP and Apollo will also seek to partner on additional investment opportunities, including potential cooperation on low-carbon gas and power assets and infrastructure.
William Lin, Executive Vice President of Gas and Low-Carbon Energy at BP: “We are very pleased to be working alongside Apollo on this key aspect of Europe’s energy infrastructure. Importantly, while this means the addition of a new investor, it does not diminish BP’s role as a strategic asset for our gas business in Azerbaijan. We see great potential in creating innovative agreements like this and look forward to continuing to explore new opportunities with Apollo through the growth of this collaborative relationship.”
Skardon Baker, Partner at Apollo: “We are delighted to partner with BP on a deal that will offer our investors long-term exposure to an industry-leading infrastructure asset with a stable cash flow profile, while enabling BP to meet its objectives of maintaining control and executing on its capital efficiency strategy.”
Leslie Mapondera, Partner at Apollo: “This innovative transaction structure is indicative of the types of tailored solutions we can offer at Apollo, and we believe we are ideally positioned to execute additional strategic transactions with BP. Together, we see more potential opportunities as we look to leverage Apollo’s expertise in long-term capital and in sustainability and infrastructure investments to partner with BP on its strategic plans, including energy transition opportunities.”
Proceeds from the transaction will contribute to BP’s 2024 divestiture target and other revenue of between $2 billion and $3 billion, which is part of the company’s disciplined financial framework. The transaction is expected to close in the fourth quarter of 2024, subject to required regulatory and regular partner approvals.
