Integrated oil and gas company TOTAL S.A. (TOT) announced that its unit Total Lubrifiants has entered into a five-year international agreement with Kia Motors Corporation. Based near Seoul, Korea, Kia Motors Corporation is a major global player in the automobile industry. The company sells its products through a network of distributors and dealers covering 172 countries around the world.
Through this new agreement TOTAL’s unit becomes the recommended partner for sale of lubricants in Kia Motors’ worldwide networks. However, the European countries and SouthKorea are not included in the worldwide recommended network of Kia Motors.
The agreement will ensure Kia Motors’ access to Total Quartz automotive, which deals in lubricants of very high performance. Kia Motors loyalists will also stand to gain from the marketing expertise of Total.
The strategic alliance is a win-win deal for both TOTAL and Kia Motors. This agreement will strengthen the international presence of these two companies, helping both to develop products of better quality and render services tailor made for consumer needs.
TOTAL is consistently expanding its operations worldwide through strategic alliances and partnerships. In March 2011, TOTAL deepened its presence in Russia by entering into two noteworthy Memorandums of Cooperation with the largest Russian independent gas producing company, OAO Novatek.
We appreciate the strategy undertaken by TOTAL to increase its global operation through strategic alliances in important markets. The company has also entered into an alliance with Suncor Energy Inc. (SU) for oil sands assets in Alberta, Canada raising its interest in Suncor’s Fort Hills project to 39.2%.
TOTAL S.A. currently retains a Zacks #3 Rank (short-term Hold rating). We maintain our long-term Neutral rating on the stock.
France-based TOTAL is one of the largest publicly traded global integrated oil and gas companies based on production volumes, proved reserves, and market capitalization. The company has exploration and production operations across five continents.
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