BP Intends to Sell Half of Lightsource BP, Bids Due in June

BP plc BP, the UK-based energy major, is looking to sell a 50% stake in its solar unit, Lightsource BP, as part of a broader effort to cut costs, improve returns and address investor concerns. The energy major is seeking a strategic partner that will provide cash and commit to future investments, with initial bids due in June, according to a report by Reuters.BP, which took full control of Lightsource BP last October for £400 million plus £2.1 billion in debt, is now looking to partially divest the unit. The initiative, called Project Scala, is aimed at securing a partner with deep expertise in renewable energy. The governance structure of the partnership would reflect joint control over Lightsource BP’s assets.The move aligns with BP’s recent strategy shift under CEO Murray Auchincloss, who has emphasized the need to increase returns from its renewable business. In February, Auchincloss confirmed that BP had been exploring partnerships to optimize Lightsource BP’s performance. The platform currently operates 5.7 gigawatts of assets across 19 markets, with more than 2 GW of new projects completed in 2024. It is also expanding into battery storage and onshore wind.BP has been under increasing pressure from investors, particularly activist fund Elliott Management, which has built a 5% stake in the company in recent months. Elliott has pushed BP to scale back its green energy investments and focus on more profitable ventures, including oil and gas.In response, BP announced last month that it would cut renewable energy investments while increasing annual oil and gas spending to $10 billion. The company is also reviewing its lubricants business, Castrol, and targeting $20 billion in divestments by 2027.BP’s sales document outlines an ambitious expansion strategy for Lightsource BP, targeting 3 to 5 GW of annual capacity additions. A new investor could provide access to specific markets, such as India, where solar demand is surging. Additionally, the company may take on a "prudent" level of debt to support future growth.BP declined to provide further details but confirmed its intention to bring in a strategic partner for Lightsource BP and launch the sales process soon. Non-binding offers are due in June, with shortlisted bidders expected in July.This partial divestment highlights BP’s effort to balance its renewable ambitions with financial discipline as it navigates investor expectations and shifting market dynamics.BP’s Zacks Rank & Key PicksBP currently carries a Zack Rank #3 (Hold).Investors interested in the energy sector may look at some better-ranked stocks like Archrock Inc. AROC, NextDecade Corporation NEXT and Oceaneering International, Inc. OII. While Archrock presently sports a Zacks Rank #1 (Strong Buy), NextDecade and Oceaneering each carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Archrock is an energy infrastructure company based in the United States, with a focus on midstream natural gas compression. It provides natural gas contract compression services and generates stable fee-based revenues.NextDecade is an emerging player in the LNG space with its Rio Grande LNG project in Texas. As demand for LNG continues to grow, the company’s strategic investments in infrastructure and planned liquefaction capacity provide strong upside potential. With the global LNG market expanding, NEXT is well-positioned to tap into the increasing export demand from the United States.Oceaneering International delivers integrated technology solutions across all stages of the offshore oilfield lifecycle. With a geographically diverse asset portfolio and a balanced revenue mix between domestic and international operations, the company effectively mitigates risk. As a leading provider of offshore equipment and technology solutions to the energy sector, OII benefits from strong relationships with top-tier customers, ensuring revenue visibility and business stability.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report BP p.l.c. (BP): Free Stock Analysis Report Oceaneering International, Inc. (OII): Free Stock Analysis Report Archrock, Inc. (AROC): Free Stock Analysis Report NextDecade Corporation (NEXT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks