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In a bold move in January 2021, the Nigerian oil company Ardova announced plans to acquire Enyo, an oil retail company with 93 outlets owned by mogul Tunde Folawiyo.
The company planned to fund the acquisition with debt-equity. It also clarified that “the Enyo deal is an acquisition, not a merger as we are buying the company 100 percent,” Business Post reported.
The acquisition was part of its efforts to capture Nigeria’s oil retail sector, adding it to its over 450 outlets. This would enable it to “deliver more through the channels” and provide “opportunities around digitalization,” Ardova said.
Earlier Acquisitions
In June 2019, Prudent Energy (now Ardova) completed the acquisition of a 74.02-percent majority equity stake in Nigerian billionaire Femi Otedola’s Forte Oil, valued at about N64 billion ($168.2 million).
By October, Prudent Energy fully acquired Forte Oil through its investment company Ignite Investments and Commodities Limited. Otedola then informed the take-over offer to the Nigerian Stock Exchange (NSE), Proshare reported. The company subsequently changed its name to Ardova Plc.
Ardova’s operations were impacted by the COVID-19 pandemic in 2020 as movement restrictions hampered sales of its oil products. Nevertheless, it reached an agreement with Shell to be a leading distributor of its lubricants in November same year, Proshare reported.
Recently, The Nation reported that Ardova’s Board of Directors has sought shareholder approval for a new capital raise of up to N60 billion in debt capital. It filed with the NSE to establish a N60-billion bond issuance program, under which a series of bonds will be issued to investors.
Ardova’s 2020 performance
Despite the economic shocks that came with the pandemic, Ardova still made some profit in 2020. Its financial statements for the accounting year showed an increase in revenue of N181.9 billion ($478 million) compared to N176.6 billion ($464 million) in 2019, with a profit after tax of N1.9 billion.
For 2020, Ardova paid a dividend of N0.19 ($0.0050), which infuriated many shareholders and led to a decline in its share price.
The oil company is owned by a Nigerian oil tycoon, Abdulwasiu Sowami. Ardova was among the oil firms licensed by the Nigerian National Petroleum Commission to lift crude oil in May 2018. They were slated to lift 950,000 barrels each over a two-year period from July 2018 to June 2020.
