WAFI Energy
ISLAMABAD: Saudi mega oil company WAFI Energy has acquired Shell Pakistan. In a notice sent to Pakistan Stock Exchange, Shell Petroleum said it has entered into an agreement with WAFI Energy to sell its 77.42% majority stake in Shell Pakistan Limited.
This seems to be a mega acquisition in energy sector in Pakistan in 2023. WAFI Energy has also published this breaking news on its official website today.
This divestment aligns with Shell’s strategy to enhance its mobility network and was initially disclosed during Capital Markets Day in June 202.
The transaction is anticipated to be finalized in the fourth quarter of 2024, pending regulatory approvals.
Following the completion of the sale, the Shell brand will continue to be present in Pakistan through brand licensing agreements, ensuring that customers will still have access to Shell’s premium fuel and lubricant offerings.
Shell Petroleum Company Limited remains dedicated to maintaining safe and reliable operations.
Shell Pakistan made an official announcement to the Pakistan Stock Exchange (PSX) on Tuesday, revealing a significant development.
According to the statement, Shell Pakistan Limited (SHEL) has received a concrete intention from WAFI Energy LLC to acquire controlling interest in the target company, involving up to 77.42% of the voting shares, surpassing the thresholds specified under Section 111 of the Act.
WAFI Energy LLC is a rapidly growing retail gas station network and is the exclusive licensee of the Shell Retail Network (gas stations) in Saudi Arabia, as outlined in the notice.
In a separate communication, the brokerage firm Arif Habib Limited (AHL) confirmed its appointment as the manager for WAFI Energy’s offer and submitted a public announcement of intention to acquire up to 77.42% of Shell Pakistan’s shares.
The notice from AHL also provided details about WAFI Energy, indicating that it was established in 2012 with an authorized and paid-up capital of 3 million Saudi Riyal.
Back in June of this year, Shell Pakistan Limited had initially announced that its parent company, Shell Petroleum Company Limited (SPCo), had expressed its intent to divest its stake in the Pakistani entity.
At that time, Shell Pakistan had reassured that this development would not impact its ongoing business operations, which would continue without disruption.
Although the earlier announcement did not specify the extent of the shareholding that SPCo intended to sell, the annual report for that year revealed that it held a 77.42% stake in SPL as of December 31, 2022, equivalent to just over 165.7 million shares. Furthermore, the company statement indicated that international buyers had shown significant interest in this offering.
In July, both Pakistan Refinery Limited (PRL) and Air Link Communication (AIRLINK) jointly expressed their interest in acquiring a controlling stake in Shell Pakistan Limited. Later reports from Bloomberg, citing sources familiar with the matter, suggested that Saudi Aramco was exploring the possibility of bidding for Shell Plc’s assets in Pakistan, marking the oil-rich nation’s potential entry into the South Asian market.
Meanwhile, a Bloomberg report stated that Shell’s divestment strategy was part of a broader effort under Chief Executive Officer Wael Sawan to enhance returns to shareholders and divest from businesses that weren’t generating sufficient profits.
More recently, Prax Overseas Holdings Limited (Prax), a UK-based company, also expressed its intention to acquire a majority stake and gain control of Shell Pakistan Limited.
According to the latest financial results from SHEL, the company reported a profit after tax of Rs6,450 million for the nine months ending on September 30, 2023, a substantial increase compared to the profit after tax of Rs2,864 million for the same period in the previous year.
