Valvoline Brand For Sale

[Mark888]

 Originally Posted By: OilGuy

Might they have started the "wear war" as a bold, last ditch effort to save a struggling portion of their business?

Ashland is mostly involved in selling chemical products at the wholesale level, and Valvoline is their only consumer products division, so they may regard it is as a poor strategic fit. Ashland has apparently been trying to de-leverage themselves (reduce debt) since their purchase of Hercules not too long ago, and right now Ashland may believe that they can get a better price for Valvoline than any of the other assets that could be sold.

 

[sparkplug]

 Originally Posted By: Ben99GT

I would use Zerex anitfreeze over Prestone any day. Prestone anitfreeze is considered the worst in my book.

This is the truth. Zerex coolant is awesome.

 

[bretfraz]

Valvoline also sells the Eagle One car care products brand, and they own the 2nd largest quick lube chain in the business, Valvoline Instant Oil Change (VIOC). Wonder if those two are part of the deal (probably...).

 

[wgtoys]

Chevron would be an obvious strategic buyer as Chevron has failed to establish a strong consumer brand name for its lubricants, even though they are well regarded by insiders. Last year's effort to establish Havoline as a premium consumer brand didn't work. Shell bought Pennzoil and Quaker State for just this reason. Likewise, BP bought Castrol. ExxonMobil has the strong Mobil-1 brand and really doesn't need another consumer brand. I'm not surprised Ashland want out of its only consumer business segment. Business-to-business selling is a whole different animal from the consumer game, and a company which is great at one it rarely great at the other.

 

[Mark888]

 Originally Posted By: wgtoys

Chevron would be an obvious strategic buyer as Chevron has failed to establish a strong consumer brand name for its lubricants, even though they are well regarded by insiders. Last year's effort to establish Havoline as a premium consumer brand didn't work. Shell bought Pennzoil and Quaker State for just this reason. Likewise, BP bought Castrol. ExxonMobil has the strong Mobil-1 brand and really doesn't need another consumer brand.

According to new reports, Prestone (Honeywell) and several private equity firms are interested. No mention of any oil companies. I am not sure that the major oil companies want anything to do with consumer marketing or retail operations anymore. Here are excerpts from this article: http://www.csnews.com/csn/petroleum/article_display.jsp?vnu_content_id=1003869959

 Quote:

Big Oil Continues to Refine Focus Big Oil companies have continued to exit the retail convenience store business in order to focus on their core competencies in exploration, drilling or refining. ... ...Last month, ConocoPhillips sold its last 600 company-owned gasoline stations to PetroSun West LLC for $800 million... ConocoPhillips, like other oil companies that are fleeing the low-margin U.S. retail-gasoline sales business, will continue to refine oil and sell fuel as a wholesaler to gas stations. The Conoco, 76 and Phillips 66 brands will continue to fly over gas stations. ...Earlier this year, ExxonMobil said it will sell its company-owned gas stations within the next few years -- citing profitability issues with the stations. On the c-store front, ExxonMobil reduced its number of corporately owned stores from 901 in 2004 to 799 this year. BP, the largest Big Oil c-store operator, also put more than 480 stores throughout the U.S. (including locations in Arizona, California, Georgia, Illinois, Ohio and Washington) up for sale as part of its previously announced plan to sell all of its stores by the end of 2009. Most of the stores were expected to be sold to franchisees, and the remaining to dealers and large distributors... ...Many major oil companies have determined that direct operations no longer fit their business model. Some are embracing franchising or complete withdrawal from any connection to direct retail.

I realize that motor is not exactly "direct" retail, but Valvoline does own a chain of retail oil changes places (as a way to guarantee a certain amount of demand for their product). And motor oil requires direct consumer marketing, which big oil companies are not very comfortable with any more due to those "obscene profits".

 

[thinking]

 Originally Posted By: OilGuy

Might they have started the "wear war" as a bold, last ditch effort to save a struggling portion of their business?

Brother, Valvoline is not "a struggling portion of their business." Valvoline for the most part and especially the last 2-3 yrs has kept them afloat, and has always produced a profit. Its basicall a way to get out debt, and too also focus 100% on the special chemical business side. I would look for Marathon, or pheraphs Chevron to bid. However, I doubt they'll sell. Valvoline is the onl consumer markets unit that ashland holds anymore.

 

[thinking]

 Originally Posted By: Mark888

[quote=wgtoys]Chevron would be an obvious strategic buyer as Chevron has failed to establish a strong consumer brand name for its lubricants, even though they are well regarded by insiders. Last year's effort to establish Havoline as a premium consumer brand didn't work. Shell bought Pennzoil and Quaker State for just this reason. Likewise, BP bought Castrol. ExxonMobil has the strong Mobil-1 brand and really doesn't need another consumer brand.

According to new reports, Prestone (Honeywell) and several private equity firms are interested. No mention of any oil companies. I am not sure that the major oil companies want anything to do with consumer marketing or retail operations anymore. Ashland is not an Oil company, and hasn't been for a number of years, almost 10 yrs.

 

[OilGuy]

 Originally Posted By: thinking

Brother, Valvoline is not "a struggling portion of their business." Valvoline for the most part and especially the last 2-3 yrs has kept them afloat, and has always produced a profit.

Before the last couple years, wasn't Valvoline losing millions of dollars a quarter/year?

 

[wannafbody]

In many cases when a company is dealing with a huge debt issue the only way out is to sell the most profitable portions of the business or risk it all going under.

 

[dennisny]

Shell may eat them up- they took over on Pennzoil and QS. Whoever takes them over will be a company with a strong reputation in the oil industry. Looks like we're running out of oil choices, Sounds to me we will be buying our oil choices just on the bottle. The product going in the bottles will be the same within time.

 

[Mark888]

 Originally Posted By: dennisny

Shell may eat them up- they took over on Pennzoil and QS. Whoever takes them over will be a company with a strong reputation in the oil industry. Looks like we're running out of oil choices, Sounds to me we will be buying our oil choices just on the bottle. The product going in the bottles will be the same within time.

There would be anti-trust problems if Royal Dutch Shell, BP, or ExxonMobil tried to buy Valvoline.

 

[wannafbody]

Maybe WalMart will buy them since they slipped to #2 ;-)

 

[hal]

 Originally Posted By: Gilitar

Prestone = Honeywell Honeywell = Fram, Autolite, Garbage, etc...

yeah..... This is going to anger me if they screw up Maxlife.