Standard Bank is pleased to announce that it advised Vivo Energy on its combination with Engen to create one of Africa’s largest energy distribution companies.
The combined group will have over 3,900 service stations and more than two billion litres of storage capacity across 27 African countries. Engen is the clear market leader in South Africa and has around 1,300 service stations across seven African countries. Vivo Energy is a major pan-African retailer and distributor of fuels and lubricants to retail and commercial customers, with over 2,600 service stations across 23 African countries, using the Engen and Shell brands.
PETRONAS will sell its 74% shareholding in Engen to Vivo Energy at completion. The Phembani Group, PETRONAS’ long-standing partner in Africa and Engen’s B-BBEE shareholder, is continuing its strong association with Engen and will remain invested as a 21% shareholder in the South African business. The transaction will further benefit employees of Engen through a newly implemented 5% employee share ownership programme, resulting in Engen South Africa being 26% owned by previously disadvantaged parties.
Stan Mittelman, CEO of Vivo Energy said: “Vivo Energy’s focus has been to invest to grow our business, and I am proud that we have more than doubled the size of our network since our formation in 2011. Four years ago, we acquired the Engen business in nine African markets, and have since worked to enhance and develop these. Vitol’s acquisition of 100% of Vivo Energy last year brings more opportunity to grow even faster. Completion of this transaction, which reunites the Engen brand across Africa, will be a step change in our growth and represents a significant commitment to the South African market whilst enhancing Vivo Energy’s portfolio in other important markets”
Phuthuma Nhleko, Chairman and Co-founder of Phembani Group said: “The Phembani Group is proud to have been a long-term shareholder in Engen since 1999, partnering with PETRONAS and helping to grow Engen into a valuable South African corporate citizen, meeting the needs of millions of ordinary South Africans. We are pleased to partner with Vivo Energy in the next phase of Engen’s growth. We are confident that together we will support Engen’s continued growth, enabling it to realise its vision.”
“As a result of our in-depth knowledge and experience in the downstream oil and gas market in Sub-Saharan Africa, Standard Bank was able to support Vivo Energy’s growth ambitions with strategic advice and multiple finance solutions,” says Charlie Houston Head of Europe, Oil & Gas, at Standard Bank Investment Banking.”
“Standard Bank’s market-leading M&A expertise and experience, as well as our ability to solve complex local and regulatory requirements, positioned us uniquely to advise Vivo Energy on this landmark transaction,” comments Sean Wegerhoff, Executive, Corporate Finance at Standard Bank Corporate and Investment Banking.
The transaction is currently pending regulatory approvals and fulfilment of conditions precedent.
Standard Bank acted as joint advisor to Vivo Energy on this transaction.