LONDON, Nov 25 (Reuters Breakingviews) – Commodity trader Vitol is buying out minority shareholders in Vivo Energy (VVO.L), a London-listed group that sells fuel in Africa. The 139 pence per share offer, which values the firm at $2.3 billion, is a 25% premium to Vivo’s undisturbed price, but still below the 165 pence at which it listed in 2018. Vitol, which currently has a 36% stake, was one of the selling shareholders back then, with a 54.9% holding.
It’s been a depressing run for what was feted at the time as the largest African initial public offering in London since 2005, and one of the few ways for UK investors to bet on the continent’s rapid growth. An illiquid stock, partly the result of having two large shareholders, Vitol and Helios, probably didn’t help. And its hydrocarbon focus will have won few plaudits from the environmental, social and governance crowd. A competition investigation in Morocco was another drag. Still, Vitol’s offer is roughly in line with Berenberg’s price target of 135 pence per share. That suggests it’s not being sold out too cheaply. (By Neil Unmack)