Oando PLC, Nigeria’s leading indigenous energy group, has announced a USD 210 million recapitalisation of its downstream operations by HV Investments II B.V., a joint venture owned by Helios Investment Partners, a premier Africa-focused private investment firm, and the Vitol Group, the world’s largest independent trader of energy commodities.
Oando PLC will retain a 49% stake in the newly formed corporate vehicle, while the Consortium will take a 49% stake and the remaining 2% will be owned by a local entity.
A new company will be formed to hold interests in Oando Marketing Limited, Oando Supply & Trading Limited, Apapa SPM Limited and Oando Trippmart Limited.
Commenting on the transaction, Oando PLC’s Group Chief Executive, Wale Tinubu, said: “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. This partnership will reinvigorate Nigeria’s downstream sector and create one of Africa’s largest downstream operations. We are extremely confident in the success and potential returns this alliance will deliver.”
The new company will be renamed OVH Energy to reflect its ownership structure. OVH will be led by a local management team, tasked with building the business, safely and efficiently. Under the new business structure, the initial board will consist of Tinubu as the chairman, Christian Chammas, CEO of Vivo Energy, which operates 1,600 service stations across 16 African countries, and other Vitol and Helios representatives. The current CEO, Yomi Awobokun, will continue in his role.
The service stations will retain the Oando brand. OVH’s assets comprise of more than 350 service stations in Nigeria with supporting infrastructure, including 84,000 tonnes of storage and a newly built inbound logistics jetty, as well as complementary businesses, mainly LPG filling and distribution, lubricants and an interest in a supply and bulk distribution company in Ghana. The new business will be the second largest downstream fuels company in Nigeria, with a market share of 12%.
Co-founder and Managing Partner of Helios Investment Partners, Tope Lawani, noted his firm’s track record of creating successful businesses. “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.”
President and CEO, Vitol, Ian Taylor said: “This investment underlines our commitment to Nigeria. 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.”