Oando sells stake in downstream operations

Oando plc has announced a $210 million recapitalisation of its downstream operations by HV Investments II B.V (HVI), a joint venture owned by Helios Investment Partners, Africa-focused private investment firm, and the Vitol Group, the world’s largest independent trader of energy commodities.

This development has led to the creation of a new company to hold interests in Oando Marketing Limited, Oando Supply and Trading Limited, Apapa SPM Limited, and Oando Trippmart Limited.

Oando will retain 49 percent shareholding in the newly formed corporate vehicle, with the consortium owning 49 percent, and the residual 2 percent owned by a local entity.
“Despite global economic headwinds, we have taken the proactive approach to establish a strategic partnership, which will leverage Oando’s sector dominance, considerable local knowledge and expertise; together with HVI’s international, and technical capabilities,” Wale Tinubu, Oando plc’s group chief executive, said.

According to the company, it will rename the new company OVH Energy to reflect its ownership structure and the commitment of its new shareholders. A local management team tasked with building the business, safely and efficiently, will lead OVH.

Under the new business structure, the initial Board will consist of Wale Tinubu, group chief executive of Oando plc, as chairman; Christian Chammas, CEO of Vivo Energy, operating the company’s 1600 service stations across 16 African countries and other Vitol and Helios representatives, and Yomi Awobokun will continue in his role as CEO.

The service stations will retain the Oando brand. OVH’s assets will comprise over 350 service stations in Nigeria with supporting infrastructure, including 84,000 tons of storage and a newly built inbound logistics jetty, as well as complementary businesses, chiefly LPG filling and distribution, lubricants and an interest in a supply and bulk distribution company in Ghana.

Upon completion, the new business will be the second largest downstream fuels company in Nigeria, with a market share of 12 percent.

“We look forward to leveraging Helios’ expertise in support of OVH’s management team, and to building another partnership with Vitol, with whom we created Vivo Energy, a leading pan-African downstream business,” Tope Lawani, co-founder/managing partner of Helios Investment Partners, said.

President/CEO, Vitol, Ian Taylor, said the investment underlined the company’s commitment to Nigeria, as “We are proud to have served our Nigerian customers for many years and we look forward to being actively involved in building this new company, alongside our existing ventures.”