|
Revelations that the Kenyan government is in talks with Chevron corporation to
buy Caltex outlets in Kenya & Uganda are being linked to the new strategy being implemented by NOCK.
The Government's interest in Caltex is seen to be
linked to its plan to boost the distribution network and market share
of the National Oil Corporation (Nock) as a means of deflating the
market power of the multinationals in Kenya. Such a feat is expected to
bring down the pump prices of fuel.
Though the
assertions have not been confirmed by the Monopolies commission, the
Energy ministry has in the past accused oil marketers of restrictive
trade behaviour and profiteering, which it believes is the cause of the
steady rise in local pump prices.
The Kenyan and Ugandan operations are up for sale
as a joint unit, putting the Government's bid for the local business at
a disadvantage against international and national oil companies that
are said to be pursuing the deal to grow their market shares in the
region. Energy Permanent Secretary Patrick Nyoike said the Kenya
Government's bid was facing stiff competition from other top private
sector contenders who are eyeing both operations.
"We
have asked them to unbundle the two operations to enable us bid for the
Kenyan operation in which we are interested," Mr Nyoike told local media.
For
some time, the US multinational has been evaluating its Africa business
to determine its continued viability as previously covered by PetrolWorld. If the sale goes through, it will
usher in new re-alignments and a flurry of re-branding in the local
fuel market.
Sources say Chevron is also considering a
management buyout with interested bidders, but details of this
arrangement remained sketchy.
The array of
potential private buyers have made the expected sale difficult for the
Government. Among those said to be interested in the deal include
Reliance Industries of India, through its local subsidiary Gapco Kenya,
Kenya Shell and OiLibya.
All the three
companies denied they were in talks for possible buyouts or
acquisitions. Analysts, however, say it would be difficult for Chevron
to close a deal with leading multinational oil marketers - especially
where the Government is a bidder - because the transaction might face
difficulties with the Commissioner of Monopolies.
The
Petroleum Institute of East Africa's market data for January-April 2008
indicates that Chevron commands 13.04 per cent of the local retail
market, making it the fourth largest oil marketer behind Shell, Kenol
and Total Kenya.
Together, the four control 78
per cent of the market leaving 33 players to compete for the rest of
the market. Analysts said this structure has insulated the market
leaders from serious competition among themselves.
PetrolWorld 310508
|
