Vivo Energy, the leading oil marketer in Kenya, agreed to purchase a 74% stake in Engen Limited from PETRONAS International Corporation Ltd.
The details of the value and timeline of completion of the deal have not been revealed.
The Phembani Group, which has had a long-standing relationship with PETRONAS and is the B-BBEE shareholder of Engen, will maintain its involvement by keeping its 21% stake in the South African company. This deal will also bring benefits to Engen’s employees through the introduction of a 5% employee share ownership program, resulting in 26% ownership of Engen South Africa being held by historically disadvantaged individuals.
The acquisition will allow the oil marketer to expand its market presence in Kenya, increase its revenue, and widen its lead over competitors TotalEnergies and Rubis.
The number of Engen fuel stations in Kenya has not been made public. However, most of the oil marketer’s locations are in Nairobi. Engen operates 1,300 fuel stations in seven African countries, whereas Vivo has a more significant presence with over 2,600 service stations in 23 African countries.
Vivo Energy Group Plc has stated they will preserve and expand the Engen brand as part of their acquisition agreement.
Vivo Energy intends to maintain and build the Engen-brand in new markets.
Vivo Energy Group Plc
According to data from the Energy and Petroleum Regulatory Authority (Epra), Vivo Energy Kenya dominated the fuel market in Kenya during the first half of last year, accounting for 23.83% of all fuel sold. During this period, the Kenyan operations of Vivo Energy Group Plc generated revenues of KES 114 billion ($924 million), a 30.6% increase from the previous year.
This acquisition of Engen by Vivo Energy Group Plc follows the firm’s takeover of Shell in 2017. It comes as the local petroleum market experiences increased activity, including the recent acquisition of motor oil and lubricants group Valvoline by Saudi Aramco.
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