African-focused Vivo Energy IPO launches successfully in London

Vivo Energy PLC launched on the London Stock Exchange last Friday with a valuation of nearly GBP 2 billion (USD 2.71 billion), the largest London initial public offering (IPO) so far this year and the largest Africa-focused IPO in more than a decade. JPMorgan, Citigroup and Credit Suisse led the listing.

The initial offer price for the just under 30% of the company floated was set at 165 pence (USD 2.24) per share and the shares advanced to 169.50 pence (USD 2.30) in conditional trading.

The company is the downstream fuels joint venture of energy trading house Vitol and Helios Investment Partners, which are reducing their stakes in Vivo Energy. The Vivo Energy IPO creates liquidity for its primary shareholders, bringing Vitol’s ownership down to 40%, from 55%, and that of Helios to 30%, from 44%.

Vivo Energy markets Shell-branded fuels and lubricants at nearly 2,000 service stations in 15 African countries.

The offer of 332.2 million shares equates to GBP 548 million (USD 742.52 million) representing 27.7% of the company.

“It’s a success,” said Vivo Chief Executive Christian Chammas. “The offer was seriously oversubscribed.”

“Our success comes from the success of Africa,” he said, noting that the average growth rate in the countries, where the company operates is roughly 4% per year.

Chammas said the listing would allow the company to join the benchmark FTSE 250 index.

The successful Vivo Energy IPO follows an aborted IPO plan from Vitol’s European downstream venture, Varo Energy, which pulled its Amsterdam flotation last month.