Cepsa to establish in Morocco as part of its enlargement strategy

Its objective is to reach a 100 points of sale within five years and a 15% market share in the medium-term

The intention is to develop an integrated downstream business in north Morocco, starting with the acquisition of retail, business-to-business and storage assets, together with a local partner, to commence the development of their business in Morocco. This will be followed by organic growth, with the objective of reaching a 100 points of sale within five years and a 15% market share in the medium-term (based on number of service stations) as well as securing product supply.

Morocco has being identified as a “preferred market for expansion due to its proximity to the refineries on the south coast of Spain, the country’s growing demand for petroleum products and its structural petroleum product deficit”, the Spanish company published in a prospectus issued last week on its stock market launch.

This will be the first time that Cepsa moves beyond the Iberian Peninsula, besides the Canary Islands, as part of its expansion strategy. Currently Cepsa owns 1,824 gas stations – of those 1,544 are in Spain, 259 in Portugal, 15 in Andorra and 6 in Gibraltar.

In recent years, the company have also focused on improving the non-fuel offering of their service stations, mainly the operation of convenience stores, car wash services and other non-oil businesses. Currently Cepsa has 1,037 forecourt shops and convenience stores at their service stations (excluding shops operated by distributors and not franchised by CEPSA), with an estimated 13% market share in Spain.

Cepsa also recently sold its 42% stake in Medgaz gas pipeline to Mudabala (Abu Dhabi). When completed, the sale is expected to reduce their net financial debt by approximately €500 million.