BP to sell stake in Banesto

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BP is to sell its 2.9 per cent stake in Banesto, the Spanish bank, after months of bitter disagreement between them. BP had alleged that Banesto had promised to buy back the shares - which BP acquired when it bought Petromed, the oil refiner, last year - but Banesto was unwilling to do so.

Under a pounds 17m agreement struck this week, 1 million of the shares held by BP have been placed in the market at Ptas3,000 ( pounds 16.95) each. This leaves BP with 1.9 per cent of Banesto, to be placed later at an undisclosed time and price.

The same arrangements will be used to dispose of BP's 2.015 per cent stake in the holding company, La Corporacion Industrial y Financiaera de Banesto.

Although BP declined to reveal when it can shed the rest of the shares, LCB said the disposal of BP's remaining stake is subject to an underwriting and placement contract agreed by Banesto.