Vitol, Carlyle to list oil downstream venture Varo in Amsterdam

Oil trader Vitol and private equity giant Carlyle will list their European downstream venture Varo Energy in Amsterdam this year. (REUTERS)
Updated 20 March 2018
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Vitol, Carlyle to list oil downstream venture Varo in Amsterdam

LONDON: Oil trader Vitol and private equity giant Carlyle will list their European downstream venture Varo Energy in Amsterdam this year, looking to raise funds to expand while luring investors with a hefty dividend pledge.
Varo, in which Carlyle, Vitol and Dutch firm Reggeborgh Invest each have 33.3 percent stakes, said in a statement on Monday that the three shareholders will sell a combined 30-40 percent of existing shares on Euronext on a pro-rata basis.
Varo, which saw underlying earnings rise to $371 million last year from $328 million in 2016, did not say how much it hoped to raise in the initial public offering. Banking sources have said the firm could be valued at €2 billion ($2.5 billion).
The company, which owns two refineries in Switzerland and Germany, and storage, blending and distribution assets in those two countries plus Benelux and France, said it intends to pay out a dividend of 30-50 percent of its profit after tax.
“We are convinced of the continued demand for fuels, including renewable fuels by our customers and believe we are well positioned to meet this demand. We are ready for the next stage of Varo’s development and growth,” CEO Roger Brown said in a statement.
Varo said it aimed to achieve over the medium term high single-digit growth in underlying earnings, primarily through organic growth and maintain a return on capital (ROACE) of more than 15 percent.
Besides paying 30-50 percent of profit to the shareholders, the firms wants to invest 30–50 percent of its free cashflow in organic and inorganic growth and use 20 percent of its free cashflow to meet its debt service requirements.
The company had revenues of $13.4 billion in 2017, up from $10.5 billion in 2016 and a net debt to earnings ratio of 0.6 times at the end of 2017.
It controls the two refineries with a total processing capacity of 165,000 barrels per day, a bitumen plant, 144 fuel distribution outlets, 232 retail outlets and 12 river bunker stations.


Barclays payments to Qatar would have been ‘unacceptable’ to market, London court hears

Updated 19 February 2019
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Barclays payments to Qatar would have been ‘unacceptable’ to market, London court hears

  • The UK Serious Fraud Office alleges that four bankers agreed to pay £322 million in secret fees to Qatar
  • It is claimed that Barclays agreed to pay Qatar more than double the standard 1.5 percent investment commission and hid this from other investors

LONDON: Former Barclays Chairman Marcus Agius could not remember if he was told the bank was paying higher fees to Qatar than other investors during an £11.2 billion ($14.6 billion) fundraising in the depths of the 2008 financial crisis, a London court heard on Tuesday.

However he said that paying such commission to one set of underwriters and not the other would have been “unacceptable to the market.” Agius is not accused of any wrongdoing.

He was the first witness to testify in the trial of four former Barclays executives, who include the then CEO John Varley.

“I would have wanted to understand why it would’ve been necessary,” he told the court.

The UK Serious Fraud Office alleges that the four bankers agreed to pay £322 million in secret fees to Qatar.

During the fraud trial — which began in January — the prosecution told the court that the then Qatari Prime Minister Sheikh Hamad bin Jassim demanded a personal fee for investing in Barclays.

It is claimed that Barclays agreed to pay Qatar more than double the standard 1.5 percent investment commission and hid this from other investors by making the payments through what prosecutors alleged were bogus Advisory Services Agreements, or ASAs, Southwark Crown Court heard.

Agius also told the court that he feared resignations from the board in 2008.

“Any one of them might have said, ‘This wasn’t what I signed up for, how do I get out of here?,’” he said.

“I’m clear that in June 2008 we at Barclays did not anticipate how much worse things were going to get. I don’t think we thought it was going to go as badly as it ultimately did.”