Mobil Oil Nigeria Plc yesterday said Nipco Plc will pay $301 million (about N91.805 billion) for the acquisition of the 60 per cent shares of ExxonMobil in the company.
Nipco, an indigenous Nigerian downstream oil and gas company, had executed a Sales and Purchase Agreement with ExxonMobil on Monday 17th October, 2016 for the acquisition of the 216,357,157 shares. But the financial consideration was not disclosed. However, the Chairman/Managing Director of Mobil Oil Nigeria, Adetunji Oyebanji said in a notification to the NSE, made available yesterday that Nipco is acquiring those shares for a consideration of $301 million subject to price adjustments for dividends and other factors.
The shares of Mobil Oil rose by 10.2 per cent yesterday to close at N241.89. Considering the market capitalisation of the N87 billion, which is the value of all the listed shares of the company at current market price, Nipco is acquiring the 60 per cent at a very high premium.
The Managing Director of Nipco, Mr. Venkataraman Venkatapathy had said the company considered this acquisition an important synergy.
“It is part of our strategic move to support Nipco’s continuous growth and expansion of its Nigerian retail footprint. We are confident of adding tremendous value to Mobil Oil Nigeria and likewise Mobil Oil will add a huge value to Nipco. In furtherance of this value addition, Nipco will continue to maintain the Mobil brand on its retail outlets as well as continue to blend and sell the Mobil brand of lubricants under Branding Licence(s) from ExxonMobil,” he said.
According to him, Mobil Oil will continue to run as a separate, distinct and independent company ,from Nipco Plc, each with its own CEO who will report to its board of directors .
“In furtherance of this transition, Mobil Oil will continue to maintain the Mobil brand at its retail outlets as well as blending and selling Mobil brand of lubricants under branding licensee [s] from ExxonMobil. In essence Mobil Oil will continue as usual and therefore the change should be smooth and seamless,” he added.
Venkatapathy expressed profound gratitude and appreciation of Nipco to ExxonMobil for selecting the company as the preferred bidder for the acquisition of the shares.
We wish to give every assurance to ExxonMobil that having entrusted us with this invaluable asset (Mobil Oil), we will ensure full brand compliance with ExxonMobil’s global standards as well as rigorously sustain and follow ExxonMobil’s code of conduct/ethos and operational excellence,” he said.
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