Investment company Lionshare Group announces transactions in fuel industry

SOUTH AFRICA – Lionshare Empowered Partners, an investment holding company and part of the Lionshare Group, has recorded two key transactions in the fuel retail industry totalling R1.6 billion (US$104.42m).

Lionshare Empowered Partner invests into agriculture, integrated energy, manufacturing, services, and impact investments sectors in line with the broader economic recovery and growth strategies of the country.

In the first deal Lionshare Empowered Partners had partnered with the Buffet Consortium, an investment firm, to acquire a R502 million (US$32.76m) service station property portfolio, with a lease-back, from the shareholders of The Fuel Company (TFC), majority owned by Kaap Agri, the listed agricultural services provider and retailer.

“Lionshare Empowered Partners and the Buffet Consortium have bold plans to grow the portfolio into a leading property owner in the sector by positioning themselves as a trusted long-term partner to oil companies and large convenience retail operators looking for secure operating tenure,” Lionshare said in a statement.

It said these companies could consider the sale of their service station properties to an empowered entity and benefit not only from the capital realisation, but also from the ownership and/or procurement recognition in terms of their broad-based black economic empowerment (B-BBEE) scorecard.

Their B-BBEE credentials would be their added advantage in a sector that is striving for transformation.

“Our rationale for the partnership with the Buffet Consortium was largely underpinned by their partnership investment ethos and track record,” Bonang Mohale, the chairman of Lionshare Empowered Partners, said.

The Buffet Consortium, together with its partners, represents a substantial privately held property and private equity investor in South Africa.

“At Lionshare Empowered Partners, our mission is to add value to all who touch our business. By investing into the convenience fuel retail sector, we will add significant value to oil companies and operators who wish to release capital through a sale and leaseback transaction with a trusted long-term landlord partner,” Bonang added.

In a second R1.1 billion (US$71.79m) deal, the Lionshare Group would participate, as shareholder in TFC, in a transaction whereby TFC acquired PEG Retail Holdings.

PEG Retail Holdings is a significant operator in the convenience fuel retail sector with 41 service stations situated throughout South Africa, most of which are strategic service stations on national highways.

This acquisition, once all the conditions precedent had been fulfilled, would transform TFC into a significant diversified retail fuel operator, also making it the leading B-BBEE retail fuel operator in South Africa, Lionshare said.

“The Lionshare Group is proud to be part of these two transformative and value-adding transactions in the fuel retail industry,” Ike Cha, the CEO of the Lionshare Group, said.

“They are key milestones in a continuous entrepreneurial journey, anchored in partnerships that began humbly in 2005, but which has ambitious goals. We aim to play a large role in the transformation of South African society, adding value to all stakeholders, and ultimately creating a lasting positive impact.”

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