Oando Plc has announced the completion of its $115.8 million gas and power divestment to Helios Investment Partners. The company announced this via a press release published on the website of the NSE.
Oando’s CEO, Wale Tinubu announced back in September that the deal would help the company repay some of its existing loans.
“The strategic alliance will firmly leverage our local knowledge and expertise alongside Helios’ strong financial capabilities. Through the optimization of our existing business operations and the expansion of our footprint, we will revolutionize the sector and position gas as a key driver for Nigeria’s economic empowerment. We look forward to completing the transaction, which will create a formidable leader of gas and power solutions in sub-Saharan Africa.”
We believe the money realized from the deal could deleverage the firm’s balance sheet while contemporaneously spurring shareholders fund. The objective of such a strategic plan is to get cash injection into its operations. Recall Oando had borrowed money to fund the acquisition of Conoco Philips in 2014 for a purchase consideration of $1.5 billion.
An economic downturn caused by the sudden drop in oil price by 50 percent damped the cash flow projection of oil companies in Africa’s populous nation.