What’s in a name? Why Rubis is ditching Kobil and Gulf brands
THE STANDARD INSIDER
By Macharia Kamau
| Oct 13th 2020 | 4 min read
THE STANDARD INSIDER
In the next two years, the KenolKobil brand will disappear.
And as with other major oil marketers that exited Kenya such as Caltex and Agip, the only remnants of the brand might be towns or matatu stages that took the oil marketer’s name during its heydays.
This comes as the new owners of the oil marketing company start rebranding KenolKobil and Gulf Energy petrol stations in an exercise that they expect to be completed by end of 2020.
It will be the end of an era for the firm that took the late Moi era politician Nicholas Biwott and his business associate about three decades to build.
Rubis Energy acquired KenolKobil for Sh36 billion last year and later acquired Gulf Energy for an undisclosed amount.
Rubis Energy Kenya Group Managing Director Jean-Christian Bergeron said the company had decided to rebrand following a customer survey. He said Kenyans polled in the survey wanted to experience a new brand.
“The three brands (Kenol, Kobil and Gulf) will disappear in the next 18 to 24 months… all sites are going to become Rubis,” he said.
“We expect to rebrand all the 230 outlets within two years. So far we have 30 Rubis sites in Kenya and plan to increase this to 50 by end of the year. The process should be completed by end of 2022, but most of the sites will be completed by end of 2021. We are also starting the process in other countries in East Africa.”
The company expects to spend over Sh2 billion ($20 million) in giving a new look to its 230 petrol stations across the country.
The firm, he said, had the option of working with one of the brands for its Kenyan and regional outfit without having to rebrand. “We considered rebranding to Rubis or keeping one of the brands. We did an extensive market survey asking customers what they would like to see and the response was that they wanted something new,” said Bergeron.
The acquisition of the two brands catapulted Rubis to market leadership in Kenya. Before the buyout, KenlKobil accounted for 15.4 per cent market share in the country, while Gulf had a 5.8 per cent share, which now translates into a market share of over 21 per cent for Rubis.
It also gives foreign-owned firms control of Kenya downstream oil industry.
Rubis, together with fellow French company Total and Vivo Energy (which runs Shell-branded outlets), control more than half of the retail petroleum market. Total Oil had 16.4 per cent market share followed by Vivo (16.2 per cent) last year, according to the Petroleum Institute of East Africa. This means the three firms had a combined market share of 53.8 per cent.
Being in such a position, Bergeron said, the company will be investing in consolidating its assets in the country.
He, however, said the company could make more acquisitions in other East African countries.
“In Kenya, we have a leading position at the moment with 230 sites, which translates into a 21 per cent market share. What we need is to improve the quality of the existing assets. There may be some opportunities, but it will not be a priority,” he said.
“For Kenya, the focus will be optimising the current assets. We have the largest retail network, and we will work within this existing network. For other countries, we might look into further acquisitions because there are countries where we do not have the critical size.”
Bergeron overseas six countries - Kenya, Uganda, Rwanda, Burundi, Ethiopia and Zambia - with Kenya as the headquarters. He is also in charge of Djibouti, which though not part of Rubis’ East African portfolio, is easier to oversee from Kenya due to proximity.
He was among the new hires that Rubis made when it concluded the acquisition of KenolKobil to oversee its interest in the region, joining from Total Oil, where he has worked for close to 30 years.
He could be said to have a fair understanding of the Kenyan and regional markets, having served as the chairman of Total’s Kenyan operation for three years to September 2018.
In the short time he has been heading the Kenya unit for Rubis, he has been dealt a major curveball following the outbreak of Covid-19.
Containment measures put in place to contain the spread of the disease resulted in significant reduction in petroleum products, eating into the revenues of oil marketing companies.
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