The deal entails the acquisition of Total’s entire
shareholding in its downstream businesses in Rwanda; 100% of Total
Burundi; 85,11% of Total Guinea- Bissau and 50% of Aero Services Sarl ,
Total’s interest in the aviation business. The Rwandan assets include
19 service stations and a depot, representing sales of 38-million tons
a year, a 22% share of Rwanda’s market. The 85,11% stake in Total Guinea-Bissau comes with four
service stations and 37 commercial customers, representing a 29% market
share. With Aero Services Sarl , “Engen will obtain Jet A1 fuel
storage, Avgas storage and into-plane refuelling truck capacity”, the
company said .
Engen, owned by Malaysian national oil company
Petronas (80%) and black economic empowerment group Worldwide African
Investment Holdings (20%) continues to consolidate its international platform on the continent of Africa. Engen
currently has a presence in 15 countries and is a leading downstream
refined petroleum products company in South Africa with 26% of the
market.
Engen CEO Rashid Yusof said : “We see this as another
solid step in our expansion. Engen has returned profits in every
country where it has operations in sub-Saharan Africa and our outlook
is positive for these three countries. They are experiencing good gross
domestic product growth and relatively low inflation rates.” Engen says the acquistions will be finalised before the end of this year “subject to approvals and pending business integration”. These are the latest of several international acquisitions Engen has made recently.
By 2016, Engen wants its international operations to
contribute 30%- 35% of the group’s sales volumes, generating up to R1bn
in operating income, according to the group’s corporate report.
In December the group acquired 60% of Shell in the Democratic Republic of Congo . The Congo government owns the other 40%. Engen spokeswoman Tania Landsberg said the company rebranded the garages acquired as part of the transaction. Earlier this year Engen bought Shell’s downstream assets
in Gabon, giving it a 28% market share in that country. It is also
finalising the acquisition of Shell’s downstream businesses in Lesotho,
in which it already has assets.
Landsberg said Engen’s growth strategy entails a combination of organic growth and mergers and acquisitions. Commenting on the group’s report, Yusof said the achievement of Epic 2016 is the main focus in the year ahead. In the past financial year, Engen’s sales rose 2,7%. The
group said it had reduced working capital with fewer customer credit
limits and past due payments. These, and a drop in inventory levels,
offset the rising cost of petroleum products. Fuel sales through service stations increased by almost 2,5% compared with the previous corresponding period.
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