Total Kenya is this year set to conclude the sale of petrol stations it was ordered to offload by the Competition Authority of Kenya following takeover of Chevron (Caltex) five years ago.
The listed oil marketer intends to sell seven stations and an oil depot in Kisumu earmarked by the regulator after the 2009 transaction.
“The company intends to dispose of some stations and other facilities in the next 12 months. These are still being used for the company’s operations awaiting conclusion of transfer of titles. Buyers have already been identified and sale and purchase agreements signed between the company and the buyers,” said Total in its annual report.
Some of the stations expected to be sold are in Bungoma, Eldoret and Litein. The firm said it did not expect the selling to affect its operations given that it had continued to open new stations.
“These are stations that we were ordered to be sold when we took over Chevron. They will have no impact on our operations,” said corporate affairs director Maurice K’Ajenjo.
Total operates 178 stations having opened one station last year. The company marked Sh225 million as work in progress attributed largely to construction work of new stations.
Mr K’Ajenjo said the sale was not based on performance. The competition watchdog had ordered the closure of Caltex stations closely located to Total outlets, creating a concentration that would have resulted in the company having dominance in some locations such as along Ngong Road in Nairobi.
Total was estimated to control 35 per cent of the Kenyan oil industry assets after the acquisition of Caltex. This was higher than the legal limit set by the Competition Authority of 25 per cent, which could have informed the condition requiring sale of some assets.
At the time of acquisition Chevron Kenya and Uganda’s assets included 165 Caltex-branded service stations, one terminal, seven fuel depots, six aviation facilities, one lubricants blending plant and a commercial and industrial fuel business.
Total overtook Kenol Kobil in 2011 to become Kenya’s largest oil marketer. Currently, it controls 21.7 per cent of the sector with Vivo Energy, which operates as Shell in Kenya, second with 18.9 per cent market share.
The subsidiary of the French multinational ended its two-year loss-making streak last year after a bailout by its parent company that settled its expensive short-term loans.
The oil marketer announced a Sh1.3 billion net profit for the period ended in December reversing net losses of Sh202 million (in 2012) and Sh71.4 million (2011).
Total also sublets some of its station shops to dealers, earning it rental income. The company reported Sh226 million in rental income last year compared to Sh220 million a year earlier.