Total said Monday it had finalized the Eur3.7 billion ($5.26 billion) sale of its 48.83% interest in Spanish refiner Cepsa to Abu Dhabi's International Petroleum Investment Company (IPIC) in line with an agreement made in February.
The French major said the sale enabled it "to further reduce its exposure to European refining" and that it had already cut its European refining capacity by nearly 25%, or 550,000 b/d, since early 2007.
IPIC, wholly owned by the government of the UAE, held a 47.06% interest in Cepsa before it launched a takeover bid earlier this year.
Total said it would continue to expand its partnership with IPIC, particularly in exploration and production.
The European Commission, meanwhile, on July 5 cleared IPIC's proposed acquisition of a controlling stake in Cepsa, concluding that it would not create competition problems.
The EC ruled that "the merged entity would face effective competitors and that the transaction would have no effect on the merged entities' incentives to coordinate their behavior."
On July 14, Cepsa's board approved the takeover bid, which values each of the more than 141.6 million shares not already owned by IPIC at Eur28 ($39.75).
Cepsa operates three refineries -- at Huelva, Algeciras and Tenerife -- with a combined capacity of 528,000 b/d and has a network of around 1,750 service stations.
The company has an upstream oil and gas division that produces around 55,000 b/d of oil equivalent and also operates in the petrochemicals and gas and power sectors.
The European refining sector is currently undergoing significant change as it grapples with over-capacity and weak margins. Several European majors have been looking to close or sell refineries in recent years, with some new outside investors coming in.
Earlier Monday, privately owned Indian refiner Essar said it had completed its acquisition of Shell's Stanlow refinery and associated marketing businesses for $1.3 billion.
Stanlow, near Ellesmere Port in the northwest of England, is the second biggest refinery in the UK, supplying about one-sixth of Britain's gasoline. It is also a key manufacturer of diesel and jet fuel.
Also on Monday, US refiner Valero said it had completed the purchase of the Pembroke refinery in Wales from Chevron at a price of $730 million, excluding working capital.
Other deals in recent months have seen PetroChina and Russia's Lukoil gain a foothold in the market, but IPIC's takeover of Cepsa makes it the biggest by any non-European company.
IPIC already has an interest in European oil and gas through a 20% stake in Austria's OMV, and has a 64% stake in Borealis, one of the continent's biggest petrochemical producers.
IPIC is also the largest shareholder in Japanese refiner Cosmo Oil, with a 20.8% stake.
