April 10, 2018 / 3:55 PM / 16 days ago

Vitol to list African venture Vivo, cancels Varo float

(Reuters) - Vivo Energy, the African fuels supplier owned by oil trading giant Vitol and Helios Investment Partners, will float on the London Stock Exchange and the Johannesburg Stock Exchange, the company said on Tuesday.

The public offering of the company, which sells Shell-branded (RDSa.L) fuels and lubricants in 15 African countries, is one of a string of large listings expected in Europe, which is on course for its busiest start to the year since 2015.

Vitol’s European refining and downstream venture, Varo Energy, was also expected to float in Amsterdam this year, but in an announcement later on Tuesday, Varo said it had canceled those plans due to poor market conditions.

Prior to Vivo’s float, Britvic (BVIC.L) Chairman John Daly will become chairman of Vivo, the company announced.

Vivo, established in December 2011 through the carve-out of Shell’s African downstream business, is wholly owned by Vitol, the world’s largest oil trader, and Helios, an Africa-focused private investment firm.

It reported adjusted earnings before interest, tax, depreciation and amortization of $376 million in 2017, up from $302 million a year earlier.

    Since the 2011 takeover, Vivo has spent $600 million on expanding its retail network and sold 9 billion liters of fuel and lubricants in 2017 – nearly 40 percent more than when it took over.

    “We have shown that we are going to continue our growth story and create more value for investors. If you want to attract investors, you want to do it where governance is really strong and London is known for that. And we also wanted to stay in Africa because we are a pan-African retail company,” CEO Christian Chammas told Reuters.

    After the completion of an acquisition later this year, Vivo will be active in 24 of 54 countries on the continent, which its management said provided a natural hedge against political turbulence, conflict and currency swings.

    The company expects to have a free float of at least 25 percent on admission, expected in May, after which it is also expected to be able to join FTSE UK indices.

    According to a bookrunner, the selling shareholders will include Vitol Africa B.V and no proceeds of the listing will go to the company.

    JPMorgan (JP.N), Citigroup (C.N) and Credit Suisse (CSGN.S) are leading the listing.

    Additional reporting by Julia Payne, Editing by Sinead Cruise, David Evans and Mark Potter

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