Vivo plans London listing to raise expansion capital

A Shell team promoting the dealer’s products in Mombasa. FILE photo | nmg 

By BRIAN NGUGI

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Summary

• Vivo Energy — which holds the Shell licence in 16 African markets — was reported last week to be eyeing an initial public offering over the coming months that could value the company at more than $3 billion (about Sh311.1 billion).
• By going public, the firm that has lately grown rapidly in Kenya, expects to access new capital to accelerate growth on the continent.
• The international reports said Vivo is working with a group of global investment banks as underwriters for the offering.

Vivo Energy Investments BV, one of the big four oil marketers in Kenya, plans to list on the London Stock Exchange (LSE) to raise capital for regional expansion.

Vivo Energy — which holds the Shell licence in 16 African markets — was reported last week to be eyeing an initial public offering over the coming months that could value the company at more than $3 billion (about Sh311.1 billion).

By going public, the firm that has lately grown rapidly in Kenya, expects to access new capital to accelerate growth on the continent.

The international reports said Vivo is working with a group of global investment banks as underwriters for the offering.

Netherlands-based Vivo Energy is a joint venture between Vitol Group, a Dutch firm, and London-based Helios Investment Partners, an African private investment firm that owns upstream oil assets in Turkana oilfields.

Vitol owns a 60 per cent stake in Vivo while Helios holds the rest. Vivo entered the Kenyan market in November 2012 after Shell sold 80 per cent of the downstream assets in 14 African countries including Kenya and Uganda for about $1 billion (currently Sh103 billion).

READ: Shell gets the nod to sell remaining stake in Vivo

Vivo Energy also operates in, Botswana, Burkina Faso, Cape Verde, Ghana, Guinea, Ivory Coast, Mali, Mauritius, Madagascar, Morocco, Mozambique, Namibia, Senegal, Tunisia and Uganda. Its retail offerings include fuels, lubricants, card services, shops and other nonfuel services like oil changes.

It provides fuels, lubricants and liquefied petroleum gas to clients including marine, and mining and manufacturing establishments. Jet fuel is sold to customers at 23 airports through a partnership with Vitol Aviation.

The company employs around 2,300 people across its African markets, operates over 1,700 retail service stations under the Shell brand and has access to about 900,000 cubic metres of fuel storage capacity.

Shell sealed a deal in April to sell its remaining 20 per cent shareholding in Vivo Energy for $250 million (Sh25.5 billion) to Vitol Group, after getting approval from regulators.

The move paved the way for Shell’s pull-out from the African oil retailing business that started in 2011. The move to offload its remaining shareholding saw Shell follow in the footsteps of other global energy giants divesting from the downstream oil business in Africa.