Photo by: Bloomberg
Integrated energy solutions group Oando will sell a 60% economic interest, as well as 51% of the voting rights, in its downstream businesses to HV Investments II (HVI) for $276-million.
HVI was a joint venture between Africa-focused investment firm Helios Investment and energy trader Vitol Group.
The Oando downstream businesses primarily comprised petroleum product retailer and distributor Oando Marketing; petroleum products trader Oando Supply & Trading; crude oil and refined petroleum products trader Oando Trading; Ghanaian supply and trading entity Ebony Oil & Gas; and Apapa SPM – a marina jetty and subsea pipeline system.
Pursuant to the acquisition, a special purpose vehicle (SPV) would hold 100% of the economic interests and 49% of the voting rights of Oando Downstream.
HVI would own 60% and Oando 40% of the SPV.
“This transaction is an exciting development in downstream West Africa. By working with Vitol, a global energy and commodities company and the largest independent trader of energy products, and Helios, a premier Africa-focused private investment firm, Oando has repositioned Oando Downstream for a new era of investment growth and profitability.
“Importantly, the divestment enables Oando to focus on its upstream and midstream businesses. Even as proceeds of the sale will be applied almost entirely to reducing Oando’s leverage, we underscore the portfolio rationalisation achieved alongside the balance sheet optimisation,” said Oando CEO Wale Tinubu.