Oando concludes N70.5 bn downstream recapitalisation
Oando Plc has completed the N70.5 billion recapitalisation of its downstream business with HV Investments II B.V., a joint venture owned by a fund advised by Helios Investment Partners, a premier Africafocused private investment firm, and Vitol Group.
The deal was first announced on June 30, 2015, and would see an immediate injection of an estimated N70.5bn into Oando’s downstream operations and the larger Oando group.
Commenting on the successful transaction, Oando Plc Group Chief Executive, Adewale Tinubu, said that despite global economic headwinds, Oando took the proactive approach to establish a strategic partnership which would leverage the company’s sector dominance, considerable local knowledge and expertise, together with HVI’s vast international, financial, and technical capabilities.
He said: “This partnership will reinvigorate Nigeria’s downstream sector and create one of Africa’s largest downstream operations. We take great pride in our origins as a predominantly downstream company, and we are extremely confident in the success and potential returns this alliance will deliver.”
Under the new business structure, all Oando retail stations would retain the Oando brand.
However, Oando Downstream would be renamed OVH Energy (“OVH”) to reflect its new ownership structure and the commitment of its new shareholders.
OVH Energy would hold interests in Oando Marketing Limited, Oando Supply and Trading Limited, Apapa SPM Limited, and Oando Trippmart Limited.
Oando PLC would retain a 49 percent shareholding in the newly formed corporate vehicle, with the HVI consortium also owning 49 percent.
A residual two percent would be owned by a local entity.
The company, recently, restructured a N94bn Medium Term Loan (MTL) facility for an additional five years while reducing its interest rate burden.
Other strategic deleveraging initiatives undertaken by the company to enhance its operations and financial positioning included the N2.8bn farm out of its EEZ 5 and 12 blocks, and the N3.7bn sale of its Akute Independent Power Plant.