ExxonMobil exits Nigeria’s downstream sector, sells stakes to NIPCO

ExxonMobil, United States-based international oil company has divested its downstream operations in Nigeria, following the acquisition of 60 percent equity at Mobil Oil Nigeria (MON) Plc, by Nipco Plc, an indigenous downstream oil and gas company.

In a message to the Nigerian Stock Exchange, NSE, yesterday the management of Mobil Oil Nigeria Plc said the Nigerian entity “has been informed by its majority shareholder, ExxonMobil Oil Corporation, that it has agreed, subject to regulatory approvals, to sell its shares representing 60 per cent of Mobil Oil Nigeria’s shares to Nipco Investments Limited, a wholly-owned subsidiary of Nipco Plc”.

Though the value of the equity has not been disclosed due to the confidential clause in the agreement between the two companies, Vanguard learnt there was a huge mark up on the current market price of Mobil’s stock on the Nigerian Stock Exchange.

At current price and market capitalization the 60 per cent equity is valued at N40.6 billion.

The deal did not affect the price of the equity yesterday which closed at N186 per share same as opening price while 57,621 units of the company’s shares valued at N11.2 million were traded in 25 deals.

With this purchase, Nipco Plc will directly and indirectly own 65.5 per cent of the issued share capital of the leading downstream marketer.

Though oil industry sources attributed the development to turbulence in the economy at large and the Nigerian oil industry in particular, management of Mobil insisted it was on strategic reasons other than those given by the industry sources.

Reacting to Vanguard’s questions, Mobil’s Communications Manger, Ogechukwu Udeagha, stated: “This decision is in no way a reflection of our view on the local business climate, financial results or the workforce.”