Valvoline’s Lubricant Product Line to be Acquired by Saudi Aramco?
- Thread starter Danh
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I hope Amsoil never sells out or goes public!
Indeed, Silver!
With $2.2 billion of the $2.6 billion sale price going directly to stock re-purchases and shareholder dividends. But, they won’t be the first major corporation to do the same thing.
On a more “what happens to their products?” note, this excerpt from Reuters makes me wonder if we’ll see a change in the VOA of their lubricants, more specifically their Extended Protection motor oil:
“…….Aramco will own the Valvoline brand for all product uses globally, though the Lexington, Kentucky-based company will continue to procure motor oil and related products from the lubricant business through a long-term supply deal.”
So it sounds like Aramco is just buying the name really. Everything else stay the same but now Aramco reaps benefits of profits and ability to sell oil.
I know some will not agree with me but, I think it's sad that all these American companies are selling out to foreign buyers. Chrysler, Pennzoil, Quakerstste, now Valvoline just to name a few. These are (were) American icons.
This is speculation in hindsight but remember that it was just several years ago that Ashland spun off Valvoline and it became its own entity with its own stock. Maybe it’s nothing but I wonder if this idea has been floating in the boardroom for a while and the spin-off was the initial part of it?
I think it’s very likely because, not long after Valvoline’s IPO, they began touting that the long term goal was for Valvoline to become a service oriented company.
I remember that as well but I didn’t think of what that meant. I had assumed that meant increasing their service side so as to increase the usage of their products.
If a company can control both the products they manufacture as well as the sale of those products then that is a full circle
️. Apple is like that. Valvoline just broke that circle. Just because Saudi Aramco has to keep the existing supplier contracts intact that doesn’t mean they will keep the same formulations.
I couldn’t agree more! When they first started talking about separating the two I couldn’t make sense of it and, still can’t. I hope it works out for them but, either way, I will no longer use Valvoline products. I’ve shifted to Amsoil. A privately owned American company!I remember that as well but I didn’t think of what that meant. I had assumed that meant increasing their service side so as to increase the usage of their products.
If a company can control both the products they manufacture as well as the sale of those products then that is a full circle
Valvoline just broke that circle. Just because Saudi Aramco has to keep the existing supplier contracts intact that doesn’t mean they will keep the same formulations.
wemay
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Pennzoil/Quaker State to the Dutch feels much different than Valvoline to the Saudis.
I'll continue to use Valvoline in my current vehicle as long as the quality remains. Its certainly sad to see an American company sold off to forgiegn interest but the harsh reality is that most of the time when you buy any oil, you could probably follow the money back to somewhere in the middle east.
Food for thought when you say that you dont want an electric car.
Food for thought when you say that you dont want an electric car.
I’m sure that’s true to some degree but, you’re talking crude oil and not the the finished lube in which we’re concerned.
That's because the Dutch are more in tune with modern thinking and freedom. The folks that run the Middle East will punish those who don't comply with their ideology.
Another concern too is how long will it actually still be the Valvoline that we've all known and loved. Im thinking I may need to do something about what oil I want to make the switch to. Probably either some kind of Mobil or Castrol synthetic high milage oil.
Shell is more like Royal “UK” Shell these days anyway, they’ve pulled out of the Netherlands. And the British generally don’t dismember journalists that disagree with their policies-unfortunately any money spent on Valvoline is now “blood money”.
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SA needed an outlet for their base oils.
They now have Motiva, which is the largest group 2 producer as well as the SK oil group 3 distribution contract for North America. Whether you like it or not, there is a high likelihood your Group 3s are coming through Aramco or Adnoc.
With Adnoc competition on the group 3s, Chevron, P66, etc competition on the group 2s, SA needed a for sure outlet to be able to dump base oil gallons at a premium.
Valvoline was that outlet.
They now have Motiva, which is the largest group 2 producer as well as the SK oil group 3 distribution contract for North America. Whether you like it or not, there is a high likelihood your Group 3s are coming through Aramco or Adnoc.
With Adnoc competition on the group 3s, Chevron, P66, etc competition on the group 2s, SA needed a for sure outlet to be able to dump base oil gallons at a premium.
Valvoline was that outlet.
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Really they bought Gallons.
Vavoline was a large Vertex customer, on both Group II and Group III business. There is only so much ILMA business that Motiva can get, as well as major business or large ILMA via P66, Citgo, Warren-Highline, Amalie. Vertex (adnoc) has an established footprint in the ILMA market. So, Motiva needed somewhere they don't have to be cut throat on all the time. Especially as base oil prices have probably hit peak and are pointing back down. Vavoline has been on and off for-sale now, for probably about 5 years. Just no one wanted to pony up the money... Timing was good, SA has had a big windfall, might as well spend that cash.
