Gandur’s AOG Invests $400 Million in Africa Energy Assets

Addax & Oryx Group Ltd., the energy firm established in 1987 by billionaire Jean Claude Gandur, is investing $400 million in Africa after failing to sell oil-trading and downstream units last year.

The Malta-based company, which has offices in Geneva, is investing the money over five to six years in downstream energy infrastructure and networks, to refocus the business away from a Swiss oil trading unit dwarfed by competitors, Gandur said.

“Either you belong to the three or four very large trading companies and you concentrate on your trading activity, or you better find a new model, and that’s what I’m developing today,” he said in a phone interview from Geneva yesterday. “It’s more downstream than trading.”

Gandur worked in the Zug, Switzerland, office of Philipp Brothers before setting up a Geneva oil-trading firm named after two types of African antelope, the addax and oryx. The largest independent energy traders, including Glencore International Plc, Vitol Group and Trafigura Beheer BV, all have offices in Switzerland.

AOG is investing in liquefied petroleum gas networks in Africa to add to four terminals, two lubricants factories and fuel stations across 22 countries, according to Gandur. He expects the LPG market to grow 12 percent to 15 percent a year in Tanzania and 10 percent to 15 percent a year in Ivory Coast. The fuel reduces societies’ dependency on charcoal and restricts deforestation, he said.

No Sale

AOG, which also has businesses in upstream energy and real estate, said in May it wouldn’t pursue the sale of its Geneva trading unit and African downstream oil and gas unit after the expiration of an exclusivity agreement with Emerging Capital Partners, a Washington-based investment firm focused on Africa.

Gandur, who lives in London and has a personal fortune of about $2 billion, according to Forbes, said he terminated the process because the buyer was too slow to complete the deal. AOG is closely held and doesn’t provide detailed information on the size of its energy businesses.

After selling Addax Petroleum Corp., an exploration and production unit, to China’s Sinopec Group for C$8.3 billion ($8.3 billion) in 2009, AOG plans to sell shares to the public in another upstream business, Oryx Petroleum, on the Toronto stock exchange this year, Gandur said. It’s hired RBC Capital Markets to advise on the process.

AOG has spent $450 million on real estate in cities including Geneva, London and New York and plans to invest another $300 million, Gandur said. The commercial property and retail acquisitions are long-term investments to provide an income for philanthropic activities, he said.