Vantage Capital, Africa’s largest mezzanine fund manager, has provided €19 million ($21.63 million) worth of mezzanine funding to Petro Ivoire, a leading distributor of oil and gas products in Cote d’Ivoire.
Mezzanine funding is a kind of financing that has both features of debt and equity financing. It provides lenders with the right to convert their loans into equity in case of a default.
Petro Ivoire operates a network of 72 petrol stations across the country, putting it in 3rd placed after Total and Vivo Energy. It is also the largest gas distributor, with over 1.7 million gas bottles in circulation. The company also holds a 40% stake in Cote d’Ivoire’s largest gas storage and bottle filling facility, SAEPP. The company sold 230 million litres of petroleum products in 2017.
Founded in 1994 by Mathieu Kadio-Morokro, the company is now run by his son, Sebastien Kadio-Morokro, who was recently selected as one of the top ten Young Global Leaders in sub-Saharan Africa by the World Economic Forum. The exit of the private equity investors has made room for a French-based gas trading company, Geogas Entreprise SAS, to take a stake in the business alongside the founding family.
Vantage’s funding has enabled the firm’s founding family to regain a controlling equity stake in the company by facilitating the buy-back of equity from two exiting private equity investors, Amethis and the West Africa Emerging Markets Growth Fund.
Outside of South Africa, Vantage has now invested in ten transactions for a total of $138 million across Cote d’Ivoire, Ghana, Nigeria, Uganda, Kenya, Mauritius, Namibia and Botswana. Petro Ivoire is Vantage’s first investment in Francophone Africa.
“Vantage’s mezzanine product provided the ideal solution to Petro Ivoire’s shareholders: enabling the private equity investors to achieve a successful exit and the founding family to acquire a controlling stake in their business without having to write out a big equity cheque,” explained Luc Albinski, Managing Partner at Vantage Capital following the announcement this week.
Meanwhile, David Kornik, Partner at Vantage Capital, noted that Petro Ivoire is run by an experienced and deeply talented management team.
“They have successfully established the business amongst the leading players in Côte d’Ivoire’s downstream oil and gas sector and we look forward to partnering with them through the company’s next phase of growth,” he said.
Jean-Thomas Lopez, Portfolio Manager at Amethis, said that his firm was proud to have supported the founding family for the last five years.
“Our vision is to be one of the largest African oil and gas distribution companies. With Vantage Capital as our financial partner, we intend to entrench our position as the leading company in this sector in Cote d’Ivoire and begin to expand regionally,” Kadio-Morokro concluded.