COMFORT EKELEME, with Agency Report
Nipco Plc has launched a N4.84 billion ($16million) offer for the shares it needs to take its stake in Mobil oil to 70 per cent to comply with Nigerian takeover rules, its advisers said on Wednesday.
Nipco’s investment subsidiary bought 60 per cent of Mobil Oil Nigeria from Exxon Mobil Corp. in October, when the U.S. giant pulled out of downstream fuel distribution in Nigeria.
Nipco, which was founded in 2001, now owns 66.7 per cent of the fuel retailer, according to an offer document seen by Reuters.
It is offering minority shareholders N417.12 per share for the 3.23 per cent of the capital, or 11.6 million shares, it needs, the same price it paid Exxon last year and a 75 per cent premium to Wednesday’s market price of N238.36.
The offer ends on June 29.
Shares in Lagos-listed Mobil Oil have lost 10 per cent this year, giving the company a market value of N85.95 billion ($282million). The shares rose 74 per cent last year.
The downstream oil industry in Africa’s biggest economy is consolidating as multinational oil firms divest to focus on upstream exploration with higher margins, especially given the backdrop of lower crude prices.
Nigeria exports nearly 2 million barrels of oil a day but imports the bulk of its refined products because its refining capacity is unable to meet the country’s daily fuel needs of 40 million litres.
Mobil Oil rival Oando has now shifted away from being a fuel distributor to explore for oil and gas. It sold a 60 per cent stake in its downstream business last year to Vitol and Helios Investment Partners for $210 million.
Mobil was founded in 1951 and operates more than 200 petrol stations in Nigeria. It also owns three plants that manufacture lubes, petroleum jelly, and insecticides in Nigeria’s commercial capital of Lagos.
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