Total and Erg have sold their TotalErg joint venture (Erg 51%, Total 49%) in Italy to the Italian refining group API for an undisclosed amount. The transaction encompasses TotalErg's network of 2,600 service stations, which accounts for about 11% of the Italian market, along with a 25.16% in the 181,000 bbl/d Sarpom di Trecate refinery. TotalErg is the Italian fourth-largest fuel marketer and was created in 2010 by merging the Total and Erg activities. With this new acquisition, API will become one of the leading distributors in Italy, with more than 5,500 stations and 18% of a market dominated by Eni and Kuwait Petroleum.
Italy is a fragmented market and TotalErg's retail profitability outlook was not in line with the company's expectations. The joint venture has already sold its LPG and Commercial Sales businesses and this third divestment raises asset disposal proceeds to approximately €750m.
In parallel with this transaction, Total has acquired Erg's 51% stake in the in the lubricants activities of the joint venture. The company believes that lubricants is high-return business and intend to expand it.
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