Brambles Limited (ASX: BXB) announced on Thursday that it sold its 50% interest in the Hoover Ferguson Group (HFG) to its joint venture partner First Reserve, an American private equity firm specialising in the energy sector.

Brambles created HFG in October 2016, merging its oil and gas containers businesses with Hoover Container Solutions. Brambles’ CEO Graham Chipchase said the logistics operations in the oil and gas industry were no longer a core business for Brambles and offered limited opportunity for strong returns.

Brambles’ stake in the joint venture was transferred to First Reserve for nominal consideration. This will result in a non-cash write down of the investment, which had a carrying value of US$4.9 million. More importantly, HFG repaid to Brambles an outstanding US$150 million subordinated shareholder loan. Brambles will use these funds to pay down debt and to fund automation projects in other divisions.

First Reserve still owes Brambles a US$37 million consideration for the equalisation of their ownership rights in HFG back in 2016, which will continue to accrue interest at 6.25% per annum until no later than 2026.

Shares in Brambles are down 1.12% to $9.68, possibly weighed down by Morgan Stanley’s prediction that the stock will fall over the next two months.