Competition Authority of Kenya approves acquisition of Engen by Vivo Energy

Competition Authority of Kenya (CAK) has permitted Vivo Energy to acquire Engen International Holdings and its 15 petrol stations across the country. Vivo Energy, based in Netherlands has finally acquired 100 percent of the issue share capital of the Mauritius-based Engen.

CAK, through a statement said it analyzed and granted permission for the transaction since the two companies are involved in importation and sale of petroleum products. The agency further explained that it considered relevant markets by looking at various factors like traffic flow patterns, retail outlets, distances between stations and transportation means.

“Geographical location was an important element because it would result in serious anti-competition consequences, denying consumers choice in given areas,” observed CAK Director General, Wang’ombe Kariuki adding that the transaction was unlikely to lessen or prevent competition in the participation of oil marketers in the industry since it was an open bid process.

As reported by the Star newspaper, an analysis by the authority concluded that 13 of Engen’s local markets did not show likelihood of raising the competition concern if the transaction was approved.

According to the CAK, distance between the acquiring party’s stations and target’s stations is significant enough – at least 3km apart. The authority further stated that the close proximity of Total and Kenol Kobil will offer vital competitive restraint.

Upon completion of this transaction, over 300 Engen-branded service stations in Africa will be added to Vivo Energy’s network, bringing the number of Vivo Energy’s service stations to over 2,100 across 24 African markets.

According to Engen CEO, Yusa Hassan, they are excited to enter into the strategic undertaking with Vivo Energy terming it as a clear alignment with Engen’s growth aspirations in Africa.