Trafigura Reported to Be Planning London Float of Puma Energy

on Dec 17, 2012

On 16 December 2012, The Sunday Times reported that the Swiss trading house Trafigura was working on plans to list its energy unit Puma Energy on the London Stock Exchange in one of the biggest London floats since the debut of rival trading house Glencore (LON:GLEN). Although Puma Energy said in a statement that a flotation was not imminent, it also noted that an initial public offering (IPO) could be an option in the future, as reported by Reuters.

**Trafigura Reported to Be Considering Energy Unit Listing**
The Geneva-based Trafigura, which gained notoriety for exporting toxic waste to the Ivory Coast in 2006, is reported to be considering floating its energy unit, Puma, which owns petrol stations, ports and refineries in 34 countries in the developing world. The Sunday Times quoted Puma’s CEO Pierre Eladari as saying that he could float in 2013. “It’s something we are prepared to do,” noted Mr Eladari. “We are almost finished in terms of corporate structuring to be able to do it.”

Although Mr Eladari declined to comment on the potential size of the IPO, The Sunday Times quotes bankers as seeing the float valuing the company at £3 billion. The parent company, Trafigura, owns 65 percent of Puma after it sold a 20 percent stake to Angola’s state oil company Sonangol in 2011. The remaining 15 percent are held by private investors.

**Puma Energy Well Funded**
Reuters reported that in a response to The Sunday Times article, Puma Energy said that while a listing could be considered in the future, it was not imminent. “Puma Energy is well funded by its existing shareholders and has no immediate needs to go to the public markets”, the company wrote in an e-mailed statement, as quoted by Reuters. “As we have stated previously, an IPO could be one of various options at some point in the future.”

!m[The Company Could Be Potentially Valued At £3 Billion](/uploads/story/1040/thumbs/pic1_inline.png)The Sunday Times, however, notes that the floating of Puma would allow Trafigura to reduce its stake in the energy unit to less than 50 percent which would allow Puma to operate as a standalone business. “The 50 percent threshold is the key,” Mr Eladari pointed out, as quoted by The Sunday Times. “At that stage, none of our financing would impact Trafigura’s financing.”

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**Expansion Drive**
The Sunday Times also quotes Mr Eladari as saying that the proceeds from the potential listing would be used to fund Puma Energy’s expansion drive, which accelerated in 2010 with the company purchasing BP’s (LON:BP, NYSE:BP) fuel marketing businesses in Botswana, Namibia, and Zambia, as well as BP’s 50 percent interest in BP Malawi and BP Tanzania.
Among Puma’s more recent acquisitions are also a Chevron (NYSE:CVX) division in Vietnam, as well as Chevron’s businesses in Puerto Rico and the US Virgin Islands. In addition, in March 2012, Puma Energy also acquired Exxon Mobil’s (NYSE:XOM) fuels marketing and supply businesses in Belize, El Salvador, Guatemala, Honduras, Nicaragua and Panama. The Sunday Times notes that over the past five years, Puma Energy expanded from 12 to 34 countries, most of them in South America and Africa, whereas its staff increased from 450 to 20,000.

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