Ardova Plc Acquires Enyo to Emerge Largest Downstream Firm

Ardova Plc (AP) yesterday said it had reached an agreement to acquire a 100 per cent equity stake in Enyo Retail and Supply Limited (Enyo).

AP stated this in a corporate disclosure to the Nigerian Exchange Limited (NGX), which was a follow-up to the company’s statement earlier that it was positioning to purchase Enyo after the conclusion of a due diligence exercise.

According to AP, by acquiring Enyo, it will become the largest downstream energy company in Nigeria, as it will add Enyo’s 95 existing stations to its existing portfolio of 450 stations nationwide, to bring the combined group to a network of 545 stations.

Chief Executive Officer of AP, Olumide Adeosun, also highlighted the synergistic benefits of the acquisition, saying: “On completion, this acquisition will lead to a stronger downstream energy group that benefits from the increased customer reach and service delivery excellence of both companies, with the combination expected to produce stronger financial results.”

AP and Enyo have indicated a commitment to close the transaction in the third quarter of 2021, following the satisfaction of agreed closing conditions and receipt of regulatory approval. To this end, AP has appointed Stanbic IBTC Capital Limited and Banwo & Ighodalo as its financial and legal advisers, while Rand Merchant Bank and Herbert Smith Freehills Paris LLP are acting as financial and legal advisers to Enyo.

The company noted that the acquisition of Enyo was a pointer to both AP’s competitors and the investing public of its ambition to become Nigeria’s leading integrated energy company.

AP’s management has, since its 2019 takeover of Forte Oil and subsequent rebranding in 2020, successfully positioned the company to be more competitive in the downstream sector. The company has improved its efficiency, reduced costs of funds, and restructured its balance sheet to create a better runway for profitability. The recent announcement of the deal to be the sole-distributor of Shell lubricants and significant investments in liquefied petroleum gas (LPG) via construction of the largest LPG storage facility in Nigeria at Apapa and the deployment of LPG skids across its retail network, signal a company on its way through a transformational program of investments outside of conventional white products.

Meanwhile, trading at the domestic equities market opened the week on a negative note as the NGX All-Share Index fell by 1.7 per cent to close at 38,507.33. The total volume of trades increased by 2.9 per cent to 297.35 million shares valued at N3.65 billion in 4,402 deals.
Source: ThisDay