 "RIL arm sells stake in African fuel retailer GAPCO to Total")
Reliance Industries (RIL) said it had signed agreements with Total SA of France for sale of its entire 76 per cent stake in Gulf Africa Petroleum Corporation (Gapco), for an undisclosed sum.
RIL had bought the 76 per cent stake in 2007, with management control. Gapco has significant presence in the downstream petroleum sector in Tanzania, Uganda, Rwanda and Kenya. RIL’s foreign arm, Reliance Exploration and Production DMCC (REPD) had the 76 per cent; Fortune Oil Corporation, Mauritius, had the rest.
“REPD’s agreement to sell its interest in Gapco is part of a joint transaction wherein both it and the minority shareholder have agreed to sell their entire respective holdings for cash. The net proceeds will be finalised on completion of the transaction, expected to be within the coming months,” RIL said.
The firm said Mauritius-incorporated Gapco was a holding company with subsidiaries in Tanzania, Kenya and Uganda, primarily engaged in petroleum products’ import, beside trading, storage, marketing and supply of oil products. It owns 260 thousand kilolitres of storage capacity and operates 108 retail outlets. The transaction is subject to regulatory nods and other closing conditions.
Total said the buyout of Gapco assets would help it expand in the continent. “This buyout is in line with Total’s growth strategy for the distribution of products and services in Africa, aiming at expanding in fast-growing regions," said Momar Nguer, president of marketing & services.
"These assets, which complement our activities in East Africa, will help us fully leverage synergies of size and build the most competitive integrated regional supply, logistics and marketing base," he added.
The main assets acquired by Total include terminals in Mombasa and Dar-es-Salaam and a network of 100 gas stations. The company said the acquisition of the assets is complementary to Total's existing operations in Kenya, Uganda and Tanzania and will strengthen its logistics in the region and accelerate the growth of service station network, particularly in Tanzania. Total claims it is a leading petroleum product retailer in Africa with a network of more than 4,000 service stations. The company aims to grow its market share from 17 per cent in 2015 to more than 20 per cent.
