Chairman, Board of Directors, Nipco plc, Chief Bestman Anekwe has explained that the acquisition of ExxonMobil Oil Corporation [EMOC] 60 percent equity ownership in Mobil Oil Nigeria plc by Nipco Investments limited [NIL] was a strategic initiative to support its growth and expansion in the downstream sector of the nation’s oil and gas industry.
Anekwe who spoke through the Managing Director, Venkataraman Venkatapathy in an address to shareholders at the Company’s Extraordinary General Meeting in Abuja said the development would also help in solidifying its enviable status in the sector.
“Strategically, this acquisition will allow us to broaden our geographical diversification, adding a new platform to the Company’s network of businesses and would also afford us the opportunity to apply our model for retail, creating value through improved efficiency and productivity in MON’’, he said.
Anekwe noted with MON’s
270 ‘Mobil’ branded fuel stations at various strategic locations of the country, and its huge blending and distribution unit of world class ‘Mobil’ branded lubricants used and trusted by people not only within Nigeria but across the world, the company felt compelled to bid for the acquisition.
According to him, The Company would continue to maintain the Mobil brand on its retail outlets as well as continue to blend and sell Mobil brand of lubricants under branding license from EMOC.
He recalled that NIPCO made its debut into the retail market in 2009; but as at November 2016, we are successfully running 180 fuel stations across various locations scattered across the country stressing this track record of success has given the firm foretaste of the enormous potentials in the retail sector, and has in turn, engendered a voracious appetite for growth and expansion.
Going down memory lane on the issue, Anekwe noted that in line with this vision, the Company seized the opportunity to purchase 6.67 percentage of MON shares when it presented itself a few years ago and became the second largest shareholder after EMOC.
According to him ,When EMOC later announced its intentions to divest its 60 percentage stake in MON and along with about 20 other bidders going through a rather arduous ,rigorous and stiffly competitive bidding process before being formally declared Preferred Buyer.
He explained that part of the parameters used in arriving at the preferred bidder includes professionalism and expertise in running the downstream which EMOC said NIPCO towers among its peers.
The Chairman pointed out that following the declaration of the Company as the Preferred Buyer, EMOC entered a Sale and Purchase Agreement [SPA] with NIL, to sell its 60 percent stake in MON on 17th October, 2016 .
He said that with the execution of the SPA, a transition process which will last about six months, has begun and he Company has also initiated the process of obtaining regulatory approvals from requisite agencies – the Securities and Exchange Commission [SEC] and the Nigerian Stock Exchange [NSE] .
Anekwe told the shareholders who expressed great delight in the feat that the deal is expected to lead to increased value and wealth maximization for investors of both companies as an acquisition of this nature is sure to create a sustainable competitive advantage with both companies emerging stronger and better.
He pointed out that MON will continue to run as separate company from NIPCO Plc with each company having its own CEO and each CEO reporting to its Board of Directors.