Puma Energy announced that it had acquired a majority stake in Kenya’s Kenol Kobil, a company that has operations in nine African countries including Ethiopia, Capital learnt.
“In October 2010 Puma energy bought five operating companies of BP in Southern Africa, Nambia, Botswana, Zambia, Tanzania, and Malawi. This was the latest expansion of our business before Puma Energy became interested in buying the Kenol Kobil in Kenya on Monday, May 7,” said Mark Eadie, Head of Corporate Affairs of the Trafigura, which is a parent company to Puma Energy. The deal, however, remains subject to regulatory approval from Kenya’s Capital Markets Authority.
In a press conference on Tuesday at Radison Blu the Head Corporate added: “Since its inception in 1997 Puma Energy has shown rapid growth in transforming the midstream and downstream oil business by delivering high quality fuels safely, swiftly, and reliably at a fair price.” Capital understood that with a turnover of USD 8.1 billion, the company manages 25.1 million cubic meters of fuel storage capacity at 38 terminals and runs a network of close to 1,200 service stations.
Mark Eadie declined to give the amount of money the company intends to pay for the purchase of Kenol Kobil. “I am not entitled to reveal matters related to finance. What I know is that Puma Energy takes 68 percent of the majority share,” he said. But he confirmed that in buying Kenol Kobil, Puma will possibly get about USD $2.5bn in net sales, from an asset base of more than 400 retail service stations and 180,000 cubic metres of storage capacity. Most importantly, the acquisition offers Puma the perfect opportunity to enter the East African region, which is now believed to be a strong oil and gas frontier.
The head of Corporate Affairs came to Addis Ababa to see how Kobil Ethiopia operates.
“This is not the first time I have come to Ethiopia. This time I came to have an overview of Kobil Ethiopia, the parent company of the Kenol Kobil Group which is Africa’s fastest growing indigenous oil marketing conglomerate with an expansive investment portfolio spanning the entire Eastern, Central and Southern parts of the African continent,” the Corporate Affairs head said. The Group consists of subsidiaries in nine African countries outside Kenya (Head Office) including; Uganda, Tanzania, Rwanda, Zambia, Ethiopia, Burundi, Zimbabwe, Mozambique and Congo DR.
Kobil has 65 fuel stations in Ethiopia with the capacity of 4,000 cubic meters. Sources close to Kobil Ethiopia said that Kobil began operations after buying some stations from the now defunct Shell Company. With one account they bought no greater than 10 stations including the Piazza, Churchill road and Teklehaimanot stations. Asked about the expansion project in Ethiopia, the Corporate Affairs head said that it is too early to comment on this. “What I know for sure is that Ethiopia has the potential for expansion. We will consider this after the deal is finalized in the coming 8 to 12 weeks,” he added.
Kenol Kobil is listed on the Nairobi Stock Exchange. With the purchase of majority share the Swiss firm Puma Energy is expected to bring a huge financial muscle to the region, coupled with vast experience from its operations in regions such as Latin America. The purchase is just part of a string of Puma’s acquisitions. On March 1, Puma announced that it had completed the acquisition of Exxon Mobil’s downstream businesses in six Central American markets, Guatemala, El Salvador, Honduras, Nicaragua, Panama and Belize respectively. And less than two months later, on April 19, Puma also announced that it bought a liquefied petroleum terminal in Benin.
Mark Eadie who left for Uganda for the same mission said that Kenol Kobil Uganda had built an impression of a company that was also on an expansion campaign of its own. Last year, the firm acquired all the assets of Phoenix Petroleum Uganda limited, plus a high fuels depot in Jinja. Although, talk of the majority stake in the company being sold has been rife in Kenya for weeks. Kobil has been operating in Uganda since 2000. The company’s lubricants continue to attract many customers, although it has struggled to shed off the perception that its petrol prices are among the highest on the local market.