Kenya Shell sold to Nigerian fund in billion-dollar deal
Shell petrol station along Kenyatta Avenue in Nairobi. KENYA SHELL’S petroleum trading business is set to change ownership in the next three weeks and its country chairman Jimmy Mugerwa is expected to step down. File
KENYA SHELL’S petroleum trading business is set to change ownership in the next three weeks and its country chairman Jimmy Mugerwa is expected to step down.
Plans are in place for the firm to get a new corporate brand as Vitol Holding BV and Helios Investment Partners acquire Royal Dutch Shell Plc’s Kenyan business.
Kenya Shell’s name is expected to change to Vivo Energy Kenya. Vitol and Helios each have 40 per cent shares of Vivo Energy while Shell Plc retains 20 per cent stake.
Shell’s businesses in Burkina Faso, Guinea, Cote d’Ivoire, Morocco, Senegal, Cape Verde, Mauritius, Tunisia, Madagascar and Mali have transitioned to the Vivo Energy brand. Kenya, Uganda, Ghana and Egypt will be transferred within 2012.
Industry sources said the takeover of Kenya Shell, to be spread out over a period of time, starts in the next three weeks and Mr Mugerwa’s departure is imminent, thought it could not be confirmed from him as he was outside the country on official duty.
The next port of call for Mr Mugerwa, who is also Shell’s general manager for East Africa is yet to be known. He has worked for over 20 years in oil industry in Africa and Europe.
Key player
Kenya Shell which control’s 17.8 per cent of the market, owns storage facilities in Mombasa and Nairobi with retail outlets countrywide. The firm markets petrol with other refined oil products and Shell brand of lubricants.
Data compiled by Petroleum Institute of East Africa shows Kenolkobil holds 25 per cent of Kenya’s market, Total (23.3 per cent) Libyaoil (8.8 per cent), National Oil Corporation of Kenya (5.6 per cent) and Bakri (3.1 per cent).
The takeover is likely to spark anxiety as the Industrial Court on July 2, 2010 restrained Kenya Shell from selling or transferring its assets to before receiving written consent that employees were agreeable to the transition.
With the takeover, Shell will join multinationals like Agip, Mobil, BP, and Chevron (Caltex) that sold their assets in Kenya and other African countries as a result of dwindling returns and difficult business environment. It has led local firms like Hass Petroleum, Hashi Energy, Galana and Petrocity to increase market presence while Kenyan owned KenolKobil and Engen of South Africa have expanded operations on the continent.Â
