CAK approves acquisition of Engen by Vivo, Latter ordered to part away with two petrol stations
Competition Authority of Kenya has approved a share transaction between Vivo Energy Holding (distributes and markets Shell-branded fuels and lubricants) and Engen Holdings that was initialized in December last year.
Vivo has further been ordered to sell/ close two fuel stations located along Parklands and Enterprise roads respectively. This should be done within 36 months from the date the merger approval is notified to the parties says CAK
The regulator says that the acquisition was unlikely to lessen or prevent competition in the participation of oil marketers in the industry since it was an open bid.
“A critical analysis of the geographical locations of the targets stations against those of the target was done in order to establish the likelihood of the proposed transaction lessening or preventing competition,” CAK said in a statement
According to the CAK the distance between the acquiring party’s stations and target’s stations is significant enough, at least 3km apart. The regulators added that the close proximity of Total and Kenol Kobil will offer vital competitive restraint.
Upon completion of this acquisition nine new countries over 300 Engen-branded service stations in Africa will be added to Vivo Energy’s network, taking its total presence to over 2,100 service stations across 24 African markets.
The new markets for Vivo Energy included in the transaction are DR Congo, Zimbabwe, Réunion, Zambia, Gabon, Rwanda, Mozambique, Tanzania and Malawi. Engen’s Kenya operations (where Vivo Energy already operates) are also part of this transaction.
Engen Holdings (Pty) Ltd will retain its interest in Engen Petroleum Limited (the South Africa business and refinery) and Engen’s businesses in Mauritius, Botswana, Ghana, Namibia, Swaziland and Lesotho, which are not part of this transaction.