Carlyle buys minority stake in Cepsa for $3.6bn

The deal gives the company an enterprise value of $12bn, which equates to 7x its 2018 EBITDA.

Carlyle bought a 30% stake with the right to increase its holding up to 40%, while Mubadala will remain the majority shareholder. In addition, Carlyle will control at least two seats on the company's board.

Equity for the investment was deployed from Carlyle International Energy Partners I and II, Carlyle Partners VII, Carlyle Europe Partners V and co-investors.

The sale ends an auction process started in August 2018 that saw interest from Blackstone, Apollo, CVC, Macquarie and several industrial players, as well as Carlyle, according to press reports.

Mubadala also considered the possibility of listing a 30% stake in the company on the Spanish stock exchange, but abandoned this plan in October 2018, citing poor conditions on the international equity markets.

Company
Established in 1929 and headquartered in Madrid, Cepsa specialises in producing oil and gas, and distributing petrol and energy across the Iberian peninsula.

The company operates across the entire petroleum value chain in 20 countries worldwide, and owns significant reserves in the Umm Lulu and Satah al-Razboot fields located offshore from Abu Dhabi. Cepsa also operates as an oil producer in Algeria, Central and South America and south-east Asia, and owns two refineries in Spain.

In addition, the company manages a retail business that consists of a network of petrol and service stations across the Iberian peninsula, and an integrated energy offering to Spanish consumers, covering liquid fuels, gas and electricity.

Cepsa generated EBITDA of around €1.7bn from revenues of €24.7bn in 2018, up 19% on 2017. The company reported net debt of €3.1bn and a decrease in its adjusted net profit to €753.7m in 2018, from €884m in 2017.         

People
Carlyle Group – Marcel Van Poecke (head of Carlyle International Energy Partners).
Mubadala Investment Company – Musabbeh Al Kaabi (CEO, petroleum & petrochemicals).

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