Exxon Mobil Looks Into Selling German Esso Chain

Esso has more than 1,100 gasoline stations in Germany.

July 11, 2012

HAMBURG - Exxon Mobile Corp. is considering selling off its German Esso gasoline station chain, Bloomberg Business Week reports. Esso currently operates more than 1,100 gasoline stations in the country.

The company??s sale price could top $1.3 billion (1 billion euros). Exxon has been talking with several interested parties, and no final sale decision has been reached.

Exxon CEO Rex Tillerson has been shedding filling stations since 2008 to get out of markets with stagnate or dropping fuel demand. Exxon??s owned or leased gasoline stations dropped to 7,753 as of the end of 2011, well down from its 11,446 in December 2007.

"The trend in Europe is for companies to focus their retail and refinery businesses," said Achim Wittmann, an analyst with Landesbank Baden-Wuerttemberg. "In the upstream sector you have higher returns on investment, coupled with an increase in needed spending as reserves are depleted."

In 2011, Exxon made only a 1/3% profit margin from refining and selling motor fuels, while it gained a 74% margin from pumping natural gas and oil. "Having the whole value chain can help, that??s why we see some companies holding on to parts of their downstream operations," said Wittmann. "The market is so saturated that I don??t know if those kinds of assets would be attractive."

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