Companies

KenolKobil owner to shake up Uganda, Rwanda units

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A KenolKobil petrol station in Nairobi. FILE PHOTO | NMG

Rubis Energie is set to make changes at the 33 KenolKobil petrol stations in Uganda and Rwanda, barely six months after acquiring the entire stake of Kenya’s largest oil firm.

The French firm says it has picked a new team to work on “profound reorganisation” of the acquired subsidiaries to bring them up to Rubis’ standards. The changes will affect internal controls, organisation and governance structures.

“The integration of the KenolKobil subsidiaries is under way, with a new management team working to refocus the business on segments with higher margins and better visibility,” says Rubis in its half year 2019 performance update.

Rubis adds that the first quarter performance after completion of consolidation in April was negatively impacted by muted aviation and retail sales margins.

“The contribution of these new subsidiaries was affected by negative margins in the aviation segment over the period. It has been decided to discontinue this activity temporarily pending a repositioning,” the French firm said.

It was not immediately clear if the looming changes will result in job cuts as the group eyes efficiency from the newly acquired KenolKobil.

In Kenya, Rubis already made changes with David Ohana quitting his managing director role in the wake of an insider trading probe.

He was the one who made the Rwanda and Uganda acquisitions from Delta Petroleum just months to Rubis buying KenolKobil.

The two deals had a combined value of $12.1 million (Sh1.2 billion), according to KenolKobil’s independent financial adviser, Standard Investment Bank. KenolKobil had 430 retail outlets before the purchase of the 33 service stations.

The total price paid by Rubis was €313 million (Sh35.9 billion), leading to the exit of KenolKobil from the Nairobi Securities Exchange.

East African business is crucial for Rubis’ business, with the KenolKobil acquisition having increased the weight of its African operations in the overall breakdown of retail distribution volumes to 46 percent or 1.2 billion litres. This is trailed by the Caribbean (39 percent) and Europe (14 percent).

Rubis Africa’s operational headquarters in Dubai is also investigating product import options in East Africa.