The Africa Business Group recently advised Seven Energy International Limited on its acquisition of the entire issued share capital of East Horizon Gas Company Limited from Oando PLC for total consideration of up to US$250 million. The deal closed on 31st March 2014 and will strengthen Seven Energy’s position as a leading independent gas marketing and distribution company in the south east Niger Delta region of Nigeria. Its gas pipeline network in the region now stands at over 260 km long.
The Addleshaw Goddard team advising Seven was led by corporate partners Guy Winter and Angus Rollo, and also included Head of Energy Richard Goodfellow on gas offtake issues and banking partner John Cutler on the acquisition finance for the transaction.
Guy Winter, the lead partner on the deal, commented: “Gas has historically been a very poor relation to crude oil in Nigeria, so it’s incredibly exciting to see Seven Energy leading the way in developing the midstream gas infrastructure, through deals like this, to allow this previously-squandered resource to power Nigeria’s booming industrial and manufacturing sectors.”
Angus Rollo, head of the Oil & Gas Transactions Team, commented: "This deal brings together a number of ongoing themes we’ve seen in the Nigerian oil and gas sector: the continuing growth of strong, independent indigenous players such as Seven Energy, and the rise and rise of gas plays as the domestic gas pricing environment improves. We expect these trends to continue for the foreseeable future through a combination of ongoing supermajor divestments, government policy which supports indigenisation, and the enabling effect of a burgeoning power sector as the privatisation process continues to move forward."
Andrew Rosling, head of the Africa Business Group, said: “Nigeria is a key market for Addleshaw Goddard, and these recent deals in the oil and gas sector build on many years of investment by the firm in our client and law firm relationships in this expanding and demographically booming economy. Our increased energy capability in the region complements our traditional strengths in the Retail & Consumer sector in Africa, acting for key clients such as Diageo, PZ Cussons and BAT. Having implemented an extremely successful reciprocal secondment with leading Nigerian firm Aluko & Oyebode, what these deals demonstrate is that we are starting to experience significant benefits both in winning and executing new mandates in Nigeria.”
Seven Energy Chief Executive, Phillip Ihenacho, said: “This acquisition marks a significant milestone for Seven Energy as we continue to deliver on our strategy to become the market leading independent gas distributor in south east Nigeria. The East Horizon pipeline is an important component of the energy infrastructure of the region and we are pleased to add this asset to our portfolio.”
This marks the second significant deal this year completed by Addleshaw Goddard for Seven Energy in the Nigerian oil and gas sector. The other deal is:
* US$45 million acquisition for Seven Energy
The firm also acted for Seven Energy to acquire the issued share capital of SRL 905 Holdings, an oil and gas exploration and production company with a 60% interest in onshore Nigerian OPL 905 for US$45 million. The deal closed in January 2014. The Addleshaw Goddard team was again led by Angus Rollo and Guy Winter.
