KenolKobil deal lifts French firm’s profit

Rubis, which is looking to increase its foothold in East Africa said it has signed an agreement with Gulf Energy. [David Njaaga, Standard]

Kenolkobil has helped its new owners more than double revenues and the amount of petroleum products sold in Africa.

This comes a few months after the completion of the acquisition. The French oil major Rubis Energy attributed the rise to bringing the Kenyan firm into its fold.

The firm said in its third-quarter results that combined revenues for its African units increased 146 per cent to Sh61 billion (536 million Euros) over the third quarter to September 2019, up from Sh24.4 billion (218 million Euros).

The volume of fuel sold by the African operations also grew substantially over the quarter to 646,000 cubic metres, a 111 per cent growth compared to last year.

The firm said the volumes would have grown by a marginal one per cent in Africa had the new energy firm not been on board. “646,000 cubic metres were sold during the period, of which 337,000 cubic metres tied to the new East Africa scope,” Rubis said in a statement.

The firm concluded the acquisition of KenolKobil in March this year, where it paid Sh35 billion for a 97.6 per cent stake in the company.

A few of the retailer shareholders had turned down the offer of Sh23 per share that Rubis had offered.

The firm is now looking to increase its foothold in East Africa and early this month, it said it had signed a share purchase agreement with Gulf Energy.

Conclusion of the transaction would see Rubis cement its market leadership position in Kenya, increasing its market share to 20 per cent.

Currently, the firm, through KenolKobil, has a market share of 14.8 per cent. It is followed by Total (13.2 per cent) and Vivo (12.5 per cent).

The company’s shareholders will also walk away with billions on the completion of the deal. The owners of Gulf Energy include Francis Njogu, group chief executive Gulf Energy, who has a 20 per cent stake in the oil marketer.

Others are Paul Limo (12.5 per cent), Duncan Mukira (12.5 per cent) and Abubakar Salim (five per cent).

Other listed shareholders are Monte Carlo Investments Ltd (25 per cent) and Nama Kenya Ltd (25 per cent).

Gulf Energy generated a turnover of Sh33 billion last year, Rubis said, when it announced plans to acquire the firm. It has 46 petrol stations and has contracts with power plants and large industrial consumers. The acquisition is yet to be approved by the regulators.