Paddy Adenuga
In
a piece titled: "A lion in the sea: The battle for Chevron
Netherlands", Paddy Adenuga, the son of multi-billionaire businessman,
Mike Adenuga shares the story of how he came close to buying Chevron Oil
and Gas company in Netherland at age 29, without his family help.
It was October 2013, two years had passed since I had left the
family business in Lagos, Nigeria and moved to London, England to start
my own oil trading company. My time in the family business, as a
director in the telecoms division and upstream oil & gas company was
challenging to say the least but engaging and ultimately rewarding.
However, I have never felt comfortable with sitting back and getting a
golden pass through life. Whilst the easy thing to do was to be a “good
boy and good son” and enjoy all the luxuries of being in a family
business – I decided that striking it out on my own once again was the
best course of action.
I’ve always loved the oil & gas business, like many other
Nigerians. However, what I love about the business, particularly the
exploration and production (upstream) side, was the mixture of strategy,
operational capability, technical know-how, politics and business
acumen which all had to be married with a gambling spirit and sheer luck
to be successful. In my decision to move to London, I decided I would
only be in the oil & gas business as long as it didn’t pose a direct
conflict to the family’s interests. There is striking it out on your
own and then there is just being plain foolish. Luckily for me, I had
stopped being foolish by then.
The modus operandi of my oil trading business was simple. I kept an
office in Lagos with a small team of five to run operations and
logistics. I converted one of the bedrooms in my townhouse in London
into a study. My team in Lagos under my guidance would get oil trading
contracts and I, sitting in London, would either market these contracts
to the global oil trading houses to execute in Nigeria on a joint
venture (JV) basis or in some instances, I would find the capital to
execute the contract from end to end. This formula proved effective and
it was good enough to pay my bills and afford me an above modest
lifestyle.
One of the traits I took from my parents is that I am highly
ambitious and find it hard to sit still. There always has to be a new
conquest, a new mountain to climb, or, as is the case most times, a new
business to go after. Oil trading was my day job but was never exciting
to me except for when I got paid. After days and weeks in London
plotting my next move, I came up with an idea and a plan. In the world
of upstream oil & gas, especially in Africa, companies that were
operators, actively producing oil & gas in commercial quantities
that wanted to invest or participate in the oil business were the
darlings of the industry. They were like the prettiest girl in high
school and every guy wanted her to come to the prom with him.
Most of the oil producing nations in sub-Saharan Africa such as
Nigeria, Angola, and Equatorial Guinea would always require any investor
into oil & gas assets in their country to either be an oil &
gas operator with production on stream or be partnered with an operator,
deemed a “technical partner”. This logic makes sense. If you are going
to buy prized national assets, you should have the know how to develop
and operate them or at least be partnered with an entity that does. I
decided that I was going to use a Trojan Horse strategy. I had read
ancient Greek literature when I’d attended military academy in Texas and
it served as inspiration. I would acquire an oil & gas operating
company in Europe (the Trojan Horse), where the political barriers and
costs to entry in comparison to Africa would be significantly lower. I
would then use this newly acquired company, which would now be of
Afro-European in heritage, to become a technical partner to many local
and international investors in the upstream oil & gas business in
Africa. This company would be the first of its kind and likely the most
sought-after oil & gas company on the African continent because of
its unique DNA and ownership. After thinking of this idea, I took myself
out to a bar a few blocks from my house and ordered myself a nice
strong drink. I felt like a genius.
I registered a new upstream oil & gas investment company
offshore and called it, The Catalan Corporation. The name didn’t really
have a meaning, it just sounded nice and had a confident, stately
demeanour to it. To keep costs at a minimum, I decided to put together
an advisory board that consisted of Vance Querio, the COO of Addax
Petroleum at the time and an industry professional and my mentor (who
will remain nameless for good reason), one of Africa’s biggest business
giants. Vance was all too happy to join and signed on quickly. I called
my mentor and before signing on, he wanted a face to face meeting for me
to explain my plan and ambitions for Catalan. He asked me to meet him
in the early spring of 2014 at a health spa in a small Swiss village
outside of Zurich. I have to admit the drive from Zurich to this little
village tucked within the Swiss mountains still remains one of the most
beautiful sights I have ever seen. The spring sun had begun to melt the
snow on the mountains and in the distance; you could see the melting
snow turn into giant waterfalls pouring off the mountains. It was like
an oil painting come to life.
I eventually met with my mentor and after explaining my idea to him
and that him being on my advisory board would not only give my
burgeoning company credibility but help us raise cash, he agreed in
totality and went further to tell me that I should tell anyone and
everyone that he was not only on board but was going to give our company
his full support. We drank some tea together and the next morning I was
off back to London. My little plan for Africa oil & gas was coming
together, finally put into action by two African men in a Swiss village.
You couldn’t make this stuff up.
On the plane flying back to London from Zurich, even though I had
just gotten my mentor on board, I felt that there was someone missing. A
few years prior I was the spearhead of my family’s acquisition drive
for OML 30 (this is another whole story in itself), one of Shell
Nigeria’s most lucrative oil blocks that was up for sale, I met a
brilliant English banker named Edgar. Edgar had more than 30 years of
oil & gas operations and finance experience. He was respected by the
industry on a global basis and having him on board would be the final
piece in the puzzle, the icing on the cake. I called Edgar immediately I
landed and asked if we could meet for lunch, my treat as always.
I pitched Catalan to Edgar and how if we pulled this off it would
be the grandest of coups. Edgar was highly intrigued but stated that he
wanted hard cash upfront from the onset. Whilst the others were all too
eager to come on board and make their money via sweat equity or cash
incentives when we had a target company in our sights, Edgar wanted to
be paid money and a substantial amount before putting pen to paper. I
was confused by his behaviour. I told him who the others were that were
on Catalan’s advisory board but he wasn’t having it, either he would be
paid his princely sum to attach his name to Catalan or no deal. I was 29
at the time and was still head-strong and prideful. How could this guy
develop such an attitude? I thought we were friends. I suppose Edgar
knew his value and wasn’t going to mortgage it on a promise of monies at
a later date. As much as he liked my Trojan Horse idea, he just
happened to like money more. I balked at his request in annoyance. I
paid for lunch, told him no way, and stormed off home. This was a big
mistake on my part that would rear its ugly head later.
I appointed two of my most trusted confidants as directors in
Catalan and with that the company was set to go. I designed the logo for
Catalan – a coat of arms with a cross in the middle. I am after all a
devout Catholic and a strong believer in God, so why not have my faith
represented on my company logo? I then called my friend Nicolas Lavrov, a
web and graphics designer and over the course of a week we put together
a sleek and polished company profile which me, my directors and
advisory board began emailing out to interested parties. A few weeks
later, I got an email from Richard Kent of Jeffries. Jeffries are an
investment bank that work closely with multi-national oil companies (the
majors) on the acquisition or divestment of oil & gas assets on a
worldwide basis. Richard had gotten a copy of my company profile and
wanted to have a meeting. I wore one of my finest suits and hopped into a
taxi to his offices in London City.
Richard and I talked extensively about my background and my
ambitions for Catalan. I explained to him the type of company we were
looking to acquire, ideally an oil & gas company in Europe,
preferably operating out of the North Sea with a strong daily production
and enough reserves to warrant further investment in development. I
also told Richard how much we would be ready to spend for the first
acquisition – between USD 50 million and USD 100 million. We would
finance our acquisition via reserve based lending and would likely raise
cash equity of thirty percent of our purchase price with a Bank raising
debt of seventy percent to help the balance of the purchase price. I
had described the “goldilocks” company Catalan needed to acquire. With
that said, Richard told me to give him some time to find the best deal
for Catalan.
A few weeks later Richard called me, “I have the perfect deal for
you Paddy!” US oil giant, Chevron, had decided to sell their entire
upstream, exploration and production business in the Netherlands and had
appointed Jeffries to manage a bid process for the sale of Chevron
Netherlands. The sale included their production platforms in the North
Sea off the Dutch coast, their office buildings, around a thousand or so
native Dutch staff, and their crude and gas pipeline evacuation
infrastructure. Even the Chevron coffee and tea mugs were part of the
sale. Richard was right, this deal was perfect and the ideal Trojan
Horse with which to enter the Africa oil & gas terrain with from
Europe. He informed me that this would be a competitive bid against
other companies to acquire Chevron but thought that Catalan and I stood a
good chance. I told him I was interested and that he should send all
the necessary paperwork over. Something within me believed I was going
to win this bid and with that in mind I was going to throw everything at
it. If I won this bid, I thought, there would be stories written about
me for a long time to come.
Chevron are by nature, prudently selective with which companies
they invite to bid. So the fact that Catalan was chosen was a big deal
to me. I felt like for once in my 29 years, I wasn’t being judged solely
by my last name but for my skill, merits and ability. I got the first
bits of information from Chevron on their Netherlands assets and I began
putting together a team of hired hands to act as my management team for
Catalan’s bid. I appointed Dutch law firm DeBrauw as my lawyers,
Canadian firm Canaccord Genuity as my finance managers, RPS Energy as my
technical managers, and Moore Stephens as my accountants. I informed
Chevron of my management team and they asked for a few weeks to open the
data room and kick off the bid.
Whilst Catalan and its hired management team waited on Chevron, I
decided to be pro-active. From previous my experience with OML 30, not
engaging government regulators enough could prove to be unwise. I
decided that I needed to meet with the government body in the
Netherlands responsible for managing their oil & gas affairs. After
all I was a young Nigerian man, trying to buy prized, national Dutch
assets. I, more than anyone, needed to be ten steps ahead at any given
time. My lawyers put me in touch with Jan-Dirk Bokhoven, the managing
director at the time of the Dutch state-owned oil company, EBN. Jan-Dirk
and I spoke on the phone and agreed a date to meet at EBN’s head office
in Utrecht, a one-hour drive or so outside of Amsterdam.
I had never been to the Netherlands before. I took the first flight
from London to Amsterdam and arrived a little after 7am. The hotel sent
a car to pick me and on my ride into Amsterdam the most fascinating
thing I saw was that the Dutch rode bicycles everywhere. When parents
take their kids to school, they pop them onto the back of a bike and
ride on. I had never seen an entire city on bicycles. It was like
something out of the twilight zone. A few hours later I changed and
drove to Utrecht on a warm and sunny morning. The ride to Utrecht was
stunning. The skies were a picturesque baby blue and there wasn’t a
cloud in sight. On either side of the motorway there were golden fields
of farm land and further beyond, wind turbines spun in synchronicity.
The view was so special to me that I asked the driver to stop on the
side of the motorway so that I could get out and appreciate the scenery
for fifteen minutes or so. The driver thought I was odd.
I finally met Jan-Dirk at his offices with his head of operations,
Thijs. I could see in both their faces, looks of confusion and reverence
at the same time. How could a 29-year-old Nigerian have found himself
in a position to buy Chevron’s business in the Netherlands? I told
Jan-Dirk and Thijs of my intentions and that I took this bid seriously
and wanted to make sure that I did everything right in the eyes of not
only Chevron but the Dutch government. They both assured me that I was
on the right track and that if there was any issue, they would let me
know. I spent a few more days in Amsterdam, met up with a few friends,
and enjoyed the Dutch nightlife and hospitality. I flew back to London.
Chevron finally opened the data room for the bid and provided all
information needed for all companies to put in a bid. I put my team, my
directors, and Vance Querio on the task of reviewing all the documents
with a request that we have a bid review meeting in a few weeks. Tarica
Mpinga of Canaccord Genuity served as the lead of the management team.
Tarica called me that the team was ready to present their findings and
proposal on the way forward. I went over to Canaccord’s offices and for
once saw my team assembled in front of me. Here I was, in my late
twenties, in a massive boardroom, with a management team of fifteen
people presenting to me. I felt like I had arrived.
While acquiring Chevron Netherlands was mostly for an Africa oil
& gas play, Catalan had to deal with the reality of the company’s
books, resources, and liabilities. Chevron Netherlands by production was
attractive, producing 9000 boepd broken down into 8000 barrels of gas
per day and 1000 barrels of crude. The off-shore production facilities
were top class, the gas reserves were attractive with ample room for
development to increase production numbers, the management team of
Chevron Netherlands were the best the industry could employ, and the
crude and gas evacuation infrastructure and sales contracts were solid.
The Catalan management team presented me the bad news. The oil reserves
were seen as weak and having very little production life even if new
wells were drilled. The biggest problem however was the abandonment
liability which had been projected at first glance to be in the USD 300
million region. This became the thorn in the flesh of entire bid
process. Essentially the Dutch government required all operators to
restore their areas of operation back to how nature intended – which
meant all infrastructure had to be removed at the end of production. The
cost of this is what is termed “abandonment liability” or “abandex”.
Catalan’s management team felt that because the abandex was so high, it
negated an aggressive bid price and moreover Catalan would struggle to
raise cash to pay for Chevron Netherlands.
Unperturbed, I corralled my management team on a road show. We
would meet with as many Banks, investors, and oil trading companies as
possible to pitch Catalan’s bid and Africa strategy for Chevron
Netherlands. The team and I spent countless hours in meeting after
meeting but to no avail. The abandex amount and weak oil reserves of
Chevron Netherlands were too significant that it blinded people from the
Africa strategy entirely. Alas it was clear that this would have to be a
cash deal with no bank debt or oil trading dollars. Despondent, I
called my mentor for a way forward. We spoke extensively and as I
expected, he was the only one that saw how important Chevron Netherlands
would be as a technical partner-operator in Africa. We agreed that
between myself as a small cash contributor, himself, and a few other
investors we could raise cash of USD 50 million as a maximum bid price.
That night I went back to that bar not far from my house and ordered an
even stronger drink. This bid could not slip away from me.
Chevron sent an email to Catalan advising when they expected bids
to be received. The Catalan team once again huddled in Canaccord’s
offices to work on a bid submission document, which would include
Catalan’s offer and bid price. We deliberated for hours and the
management team insisted that because of the high abandex amount that no
cash should be offered. Essentially Catalan would agree to absorb the
entire abandex amount and would pay a notional “$1” for the company.
This would be a liability absorbing deal, allowing Chevron to clean out
and move on. The team advised that Catalan put in this offer but as a
way to play hard to get, we would commit to the gas abandex but stay
quiet on the oil abandex. I was convinced at that moment that we would
have the winning bid. The team prepared all the necessary paperwork,
which I signed, and hand delivered to Jeffries offices to the manager of
the bid process. After submitting the bid documents, I went to my
church, St. Mary’s. I always like going to church when there is
absolutely no one there. I prayed for God’s blessings and good graces.
Jeffries and Chevron confirmed they had received Catalan’s bid and
would need two weeks or so to review all bids and come back with an
answer. In the meantime, I gave a break to my management team and spent
all my free time now on my kung fu training with my master, Shifu
Heng-Wei. Kung Fu was not only for my fitness but for my well-being and
spiritual balance. It was my greatest stress-relief. On a Tuesday
afternoon, whilst Shifu and I were in the middle of an intense kung fu
session, my phone rang. I knew it was about Chevron. One of Richard
Kent’s deputies was on the line. Chevron had reviewed my bid and were
“confused” on my position in respect to the oil abandex and wanted a
re-submission clarifying Catalan’s position on both oil and gas abandex.
I immediately re-convened my management team at the boardroom and began
debating our response to Chevron. I saw this as a second chance
opportunity from Chevron to submit a more aggressive bid. My management
team argued that I should keep the same bid and state now clearly that
Catalan wanted nothing to do with the oil abandex. I countered that we
needed to be aggressive and should take the entire abandex and offer
cash of USD 50 million so that we could acquire Chevron Netherlands
uncontested and plough quickly to our Africa strategy.
The Catalan management team thought I was crazy. Surely, I was 29
and now undeniably stupid. How could I look at that enormity of an
abandex amount and now want to offer hard-earned cash on top of that?
They believed I was frequenting my local bar too often and having one
too many drinks. They pleaded with me that I follow their proposal. We
argued further and eventually as a compromise, we agreed that we would
take all of Chevron Netherlands oil & gas abandex but would still
offer a notional $1 bid price. In my heart of hearts, I felt that a cash
offer was needed to win but my management team, for which I had paid a
respectable amount for their services, had convinced me otherwise. They
were professionals I thought and they had my best interest at heart. The
team printed out the documents for which I appended my signature and
re-submitted. Again, I went to my church, when there wasn’t a soul in
sight and prayed to God for his guidance and blessings.
Chevron confirmed that they had received Catalan’s revised bid
document and would need another 2 weeks to come back to me on whether we
won the bid or not. One night as I stayed up watching CNN at home, I
had another idea. If I was able to find out whom the other bidders were
for Chevron Netherlands, I could coerce these bidders to drop their
respective bids and join me in a new multi-bidder venture. With this,
Chevron would have no choice but to sell Chevron Netherlands to Catalan
and the other bidders in a new joint venture (JV) company. This was to
be my insurance policy in case Catalan’s solo bid failed. As I said, I
am the underdog here by a country mile; I always had to be ten steps
ahead of everybody else. I arranged a conference call with my management
team and charged them to find out who the other bidders were for
Chevron Netherlands. I also pulled out my diary and began making phone
calls. At this point I didn’t care what the rules were, this was
business – either hunt or be hunted and I believed Catalan led by me,
was an apex predator, even if Chevron was one trillion times bigger than
Catalan. Fortune favours the bold and I fancied this as David versus
Goliath.
One by one, Catalan began finding out who the other bidders were.
Mercuria, an oil trading company I had done business were in the running
but then pulled out. Dana Petroleum looked at the assets but were also
out of the running. Tullow Oil was also out of the bid out of the fear
of the abandex costs. I scheduled another call with my team and asked
everyone to re-double their efforts to find active bidders. The clock
was ticking and I was keen to find the other bidders before Chevron
replied to my bid. I was too late however, on a Friday afternoon in
early summer of 2014, whilst I was out drinking rose wine with friends
at the Arts Club in London, I got an email from Chevron. They had
rejected Catalan’s bid and had deemed our bid unsuccessful. I felt like
sinking into the ground. I hastily said goodbye to my worried friends
and ran home. I couldn’t believe it. How could Chevron say no to me?
This bid was destined for me to win. I was meant to be the Alexander the
Great of Africa oil & gas and barely into my thirties.
All weekend, I re-traced my steps. I called my management team, my
directors, my advisory board, and my mentor to understand where we went
wrong. Vance Querio told me that it looked like I had fallen in love
with Chevron Netherlands and it was time to walk away. I said no way, I
was too deep in love and I couldn’t turn back now. I made up my mind
that I was going to find the remaining active bidders, coax them into
joining me, and leave Chevron with no choice. I called my management
team for a meeting on Monday and they were soundly reassured that I was
mad. The game was up and here I was, trying to bring back life to
Catalan after a deathblow. The show was not over and we were going to be
victorious. I left the meeting with a sense of purpose. That night I
went on a dinner date and bumped into an older friend of mine, Remi. I
had always looked up to Remi. Remi is smart, successful, and highly
intelligent. I felt like him and I were very much the same person and
that he was me, just twenty or so years down the road. Remi asked me
what I was up to with work and why I wasn’t in Lagos running the family
business. I coyly changed topics as I didn’t want any Nigerians knowing
what I was up to, certainly no one in “high society” or the political
elite. Even though Remi was a great guy, I couldn’t take the risk.
Chevron Netherlands was my Trojan Horse and it was on a strictly need to
know basis. We will get back to Remi later.
The next day I called Jan-Dirk of EBN and told him that I was going
to make a USD 50 million re-bid for Chevron Netherlands but this time I
wanted to do so with the other bidders as part of a JV. I was going to
use all the cash I had agreed with my mentor to go for one final strike.
Jan-Dirk at first was unsure that this was possible but when he heard
my sense of urgency and willingness to put down cash, he invited me to
back to his offices in Utrecht and felt there could be a solution. The
next morning, I dashed off to the airport and flew back to Amsterdam. I
landed early as I usually do and by this time I had gotten used to the
city being on bicycles. I remember pulling up to a red light and seeing
twin Dutch toddlers on the back of their mother’s bike waving at me.
These Dutch and their bicycles.
I met with Jan-Dirk again and this time he was more forthright and
eager to help out. He then dropped a few bombshells on me. First off,
EBN, the Dutch state oil company, were an active bidder for Chevron
Netherlands and were specifically interested in the oil side. I was
shocked. The second bombshell was that they had put in a joint bid with
an indigenous Dutch oil & gas producer called Oranje-Nassau Energy
(ONE). Thirdly, EBN knew that apart from itself, Catalan and ONE, there
was one more active bidder that wasn’t European or African for that
matter but had no leads. Jan-Dirk pledged that EBN would join my new JV
but that I had to meet the Chairman of ONE, Marcel, to get his buy in.
In my presence, Jan-Dirk called Marcel and arranged a lunch meeting in
London with Marcel and the managing director of ONE, Alex.
Back in London, I met with Marcel and Alex at a prestigious members
club that both Marcel and I were members of. Marcel and I hit it off
very well and found that we had a lot of mutual interests in common,
more so he knew my mentor and on the strength of that would be happy to
enter into a JV with Catalan and EBN. However, Alex, was slightly
reticent. Alex, it seemed wasn’t too pleased that I was charming his
Chairman right before him and wanted to put the brakes on this budding
bromance. If he wasn’t careful this young Nigerian could even end up
taking his job if this JV worked out. It then became a battle for
control now between Alex and I on the fate of the JV. Alex proposed that
the Catalan management team meet EBN and ONE at ONE’s offices in
Amsterdam the following week to discuss the structure of this new JV and
how we would formally propose to Chevron that we wanted to bid together
for Chevron Netherlands. I agreed to this meeting. I would come with
full force.
The following week, the Catalan team and I arrived in Amsterdam. I
ensured that we arrived in style. I had the hotel arrange for five,
brand new, jet-black Mercedes s-classes to ferry the Catalan management
team to ONE’s offices. I wanted Marcel and Alex to know that we meant
business and this wasn’t a Mickey Mouse affair. Marcel and Alex received
us at the entrance of their offices. We certainly made an impression,
it looked more like a state delegation had just arrived at ONE’s
offices, ready to discuss oil & gas diplomacy.
We were taken up to their main conference room where we were
introduced to the rest of ONE’s management team. Our meeting was to
discuss two major points. First, if the JV was to be successful, how
would we carve out the Chevron Netherlands empire? Secondly, if we were
to agree to the first point, how would we approach Chevron and manage
the bid process? The meeting became slightly contentious. EBN did not
attend the meeting and didn’t need to. They made it clear that they were
focused on the oil side of Chevron Netherlands and would only come in
for the oil. ONE was also no small fry, they produced 60,000 barrels of
crude and gas a day from their assets in the Netherlands and worldwide.
They were not only keen on the gas coming from Chevron Netherlands but
wanted operational control. This would leave Catalan as a mere
financier/investor with no management control.
Tensions were flaring with no headway being made. I looked at
Marcel and knew that he and I were both frustrated. I motioned to him
for us to meet outside the conference room. Marcel waved to Alex to join
us and I asked Tarica to step outside with me. The four of us walked
over to Alex’s office for a man-to-man resolution meeting. I made it
clear to Marcel and Alex that Catalan’s main objective was to use
Chevron Netherlands as an Africa operator and would make our fortune
from “selling” our technical know-how to wealthy, local investors in
oil-rich producing nations with Angola and Equatorial Guinea as prime
targets followed by Nigeria. However, Catalan would need to have
management control of Chevron Netherlands as we know potential African
partners would want to see the Afro side of an Afro-European oil company
in control. Marcel agreed and Tarica re-emphasised my point. Alex
however was keen for ONE to be an active player on the gas side as they
saw the gas production and potential as the key driver for being
involved in the first place. We agreed that Catalan would have
management control but would let ONE drive the gas affairs in the JV
with EBN doing the same for the oil. The empire had been carved. Lastly,
we agreed that we would write a joint letter to Chevron notifying them
of our intent to form a JV and permission to submit a joint bid for
Chevron Netherlands. The four of us walked back into the main meeting
and marshalled out the next steps to our respective teams. Marcel saw me
off and we both felt like we were on the verge of something great. I
spent a few more days in Amsterdam and revelled in the Dutch nightlife. I
even bought a bicycle. On one fine Amsterdam afternoon as I rode my
bike through town, I thought to myself, “I am about to be a Nigerian
Dutchman”.
When I arrived off the plane from Amsterdam to London, I got a
rather unnerving email from Alex of ONE. He was back to that
power-playing game of his again which was becoming highly frustrating.
Alex had written me stating that before EBN and ONE would agree to write
a JV letter to Chevron they needed to see financial statements from
Catalan, a substantial amount of money had to be put in an escrow
account, and he listed another laundry list of conditions precedent
(CP). I was surprised he didn’t ask for my birth certificate and my
mother’s driving license. I thought to myself “Na wa o, this Alex bobo
really has it out for me.” Alex had done this largely to checkmate me
and show that he was the authority on the JV. It was all well and good
for his billionaire Chairman, Marcel to say he was okay with it, but it
was Alex that was responsible for managing the JV and not some young
upstart. On the taxi ride back home, I thought to myself, it would take
too long for Catalan to meet all of Alex’s CP’s and in that time Chevron
could have announced a winner as I was well aware that there was
another bidder still out there that we didn’t know of. Also, Alex was
effectively making Catalan bid for ONE’s partnership. He would make
Catalan sweat to earn partnership rights with ONE and EBN and then we
would sweat further to convince Chevron of our JV. I decided this was a
dangerous road to go down and I would not cave into Alex’s demands. If
there was anything I excelled at in military academy two decades before,
it was in military strategy and tactics. I was going to put all my
training and knowledge to teach this Alex fellow a lesson. ONE and EBN
were going to sign that letter I told myself. They simply had no choice.
I devised a plan, which I fine-tuned with the other two directors
of Catalan. I made sure not to discuss the plan with Catalan’s
management team for fear that it could leak out. The Catalan directors
agreed that for our plan to be successful, I in particular would have to
eat humble pie. I had to reach out to Edgar and I’d also have to pay
that princely sum of his. In addition to Edgar, I needed to get French
banker, Guillaume Leenhardt on board. Guillaume, I had known since I was
13 years old and I’d come to find out that he was a close friend of
Marcel. I met with Edgar for a steak dinner. I swallowed my pride and
apologised profusely for our last meeting that didn’t go so well. I told
Edgar that I wanted him on my team now on a full-time basis. Edgar knew
he was needed now more than ever and cheekily asked for twice the
amount he had originally requested for. This was no longer a princely
sum but a king’s ransom. I did the math. It was worth it. I called my
Bankers and made sure Edgar was paid. That was the first chess move. I
called Guillaume and he just happened to be in London. He asked me to
meet him in Hyde Park by the serpentine lake. I arrived at the lake and
saw Guillaume sitting on a bench, feeding bread to ducks. It was like
something out of a spy movie. I briefed Guillaume on the whole Chevron
Netherlands saga and he was impressed to say the least, “You’re as
ambitious and as crazy as your father… I like it!” With that said
Guillaume was on board. More chess moves. My plan for Alex was now set
in motion, it was a mixture of “good cop-bad cop” and what Yoruba’s from
Nigeria call “Ogbon agba”, loosely translated to “An old man’s wisdom”.
I emailed Alex, copying Marcel and key members of ONE, EBN, and
Catalan’s management team. I wrote that Catalan was no longer interested
in partnering with ONE and EBN. I reminded them that Catalan was
invited to bid by Chevron and Jeffries because of our cash raising
ability. Alex’s list of CP’s was a slap in the face to Catalan and had
personally offended me and my mentor. In the same email, I instructed
the Catalan management team to cease all communication with ONE and EBN.
The email was a tsunami. ONE and EBN couldn’t believe that they had
just been dumped. Imagine telling the prettiest girl in school that you
were planning to take her to the prom, she thought she had you wrapped
around her finger, and then in one ninja move, you tell her you are no
longer interested. This dejection is what Alex and co. were now feeling.
How could ONE and EBN be told to bog off and most of all by this small
boy? It put them in a state of cataclysmic shock. Bad cop. I then called
Edgar and Guillaume that I had to write such a nuclear bomb of an email
because my mentor and investors were unhappy that ONE was trying to
shift the goal post. I asked Edgar to reach out to Alex and the ONE
management team since he knew them well to speak some sense to them,
stating that I wanted to partner with them but that my mentor and
investors were the ones holding me back, that they were about to lose
out on a fruitful partnership. I then reached out to Guillaume to do the
same with Marcel. Good cop. More chess moves. A week went by. The
Catalan team, still bewildered, called me to reverse the decision in my
email, pleading with me that my stance was suicidal. I refused to budge.
Edgar was making progress with Alex. Alex began to feel that this whole
mess was now his fault and didn’t want to look bad in front of his
organisation and EBN. He caved in and with his contrition, EBN were on
board. It was now left for Marcel to give the final green light. Marcel
was enjoying a cruise on the Greek seas on his lovely yacht and was a
little hard to reach. Guillaume finally reached him. Marcel agreed.
Checkmate. Ogbon agba!
I drafted the JV letter to send to Chevron. The reward for my
victory. I emailed it out to ONE and EBN. One hour later the letter was
sent back to me with their signatures. I signed the letter and then
forwarded it via email to Chevron and Jeffries with the Catalan
management team in copy. Tarica called me and wondered how I’d pulled
off such a coup. I told him they don’t teach such at Harvard Business
School, that this was native Nigerian business sense. We both laughed.
Chevron on the other hand wasn’t laughing. In the words of Jeffries,
“Catalan was taking over the bid process”. Chevron now knew that it
wouldn’t be too long before the last bidder was found and coerced into
the Catalan-led JV. Chevron is one of the wealthiest companies in the
world and also one of the smartest. They made a few chess moves of their
own. They decided to stall and told the JV through Jeffries that they
needed some time to consider our proposal. They would cleverly use this
time to tidy up the bid with the last, final bidder. A week passed by
and I knew this was a race against time between Catalan and Chevron. If
Catalan found this last bidder the game was up and Chevron would have to
cede Chevron Netherlands to the Catalan-led JV. Chevron for their own
part, needed to wrap things up with the last bidder because if not, they
would have been outfoxed by Catalan and might end up having to sell
Chevron Netherlands for a much smaller sale price. Worst still, there
was no way they would lose their Dutch empire to me of all people.
I called both Edgar and Guillaume, asking them to use all their
contacts and resources to find the last bidder. I arranged a conference
call between Catalan, ONE, and EBN with a clear order to find the last
bidder and that once we found them, the bid was ours for the taking.
During my time in the family business, as a director in the upstream oil
& gas business, I had a close working relationship with Chevron
Nigeria and knew its managing director. I dug deep into my email and
found emails years back between Chevron’s senior management based in
Houston and I. I reached out to the Chevron Houston team and went into
full salesmanship. The Catalan-led JV was well suited to buy Chevron
Netherlands. We were a mix of cash (Catalan), operational experience
(ONE), and government-state backing (EBN). There was no better group to
sell to. Chevron Houston asked for time to consider. Guillaume had come
up with no leads but Edgar had, the kings ransom I paid for his services
was showing dividend. Edgar had gotten in touch with Martin Lovegrove, a
senior adviser to the global CEO of Chevron. Martin informed Edgar,
that the Chevron global deal team sitting at headquarters in California –
Chevron San Ramon, were debating what to do. It was becoming an
internal debate between Chevron Houston and Chevron San Ramon on whether
to conclude with the last bidder or pivot to the Catalan-led JV. I
waited on the outcome. My 30th birthday was on June 21, 2014. I had
planned a big comic book inspired costume party to ring in my special
day but I cancelled all those plans. I felt Chevron Netherlands was
slipping away from me and this was not the time to celebrate anything.
On July 14, 2014, I received a letter from Chevron. They had made
up their mind. Chevron San Ramon had their way. There was to be no room
for the Catalan-led JV and they were concluding the sale of Chevron
Netherlands imminently. To say I was devastated wouldn’t capture how low
and defeated I felt. Chevron Netherlands was destined to be mine. I was
going to ride back into Africa on my Trojan Horse and become King. I
had given every part of me, every fibre of my being and it was
immeasurably painful to come so close to victory and lose. ONE and EBN
wrote to Catalan formally withdrawing their participation in Chevron
Netherlands. They had sailed off into the North Sea sunset. I stubbornly
refused to give up and wrote another letter to Chevron that Catalan
would be prepared to pay up to USD 100 million for Chevron Netherlands.
Frankly, I didn’t know where I was going to find the money but I was
throwing one last shot out there when in actuality it was no more than
medicine after death. A few days after my last pitch letter, Richard
Kent sent me an email; Chevron Netherlands had been sold to Petrogas of
Oman. The last bidder, the mystery company I couldn’t find. I’d later
come to find out that USD 50 million plus an absorption of all the
abandex was the winning formula for the bid – the same formula that I
had proposed to my management team but they had pushed back on. This was
a painful lesson to always trust my instincts, no matter the
circumstance. Edgar later told me that if I had brought him on from day
one, the first question he would have asked me was, “What amount are you
willing to pay for Chevron Netherlands, given what you wanted to use it
for in Africa?” I told Edgar that the price I would have paid was USD
50 million. I should have paid Edgar his princely sum the first-time
round, never again would I let ego or pride cloud my judgement.
Members of the Chevron team in London called me. They congratulated
me on a well-fought bid and marvelled at my ability to push them so
hard in their own bid process. Richard Kent of Jeffries took me out for a
drink. He told me I was the type of bidder he liked working with,
tenacious and aggressive. Richard wanted to know if I was interested in
another bid, something was coming up in Italy. I told Richard I was
done. I looked finished. I said goodbye to the Catalan team and paid
their fees. Tarica took me out for a meal, trying to encourage me. We
joked about how legendary this bid was and how I had brought back
Catalan’s quest to life on multiple occasions when all seemed lost. This
was all consolation. I thought, no one remembers the 1st runner up,
second place is just not first place. My mentor called me and told not
me not to be hard on myself, that this was all a learning process and
that it would shape me for further battles in the future. I agreed with
him but nothing could make up for my loss.
Whilst I lay in bed that night, one of my closest confidants
nicknamed Heisenberg and a director in Catalan called me. I remember our
conversation like it was yesterday. Heisenberg said, “Mr. P, how many
people are given the opportunity you had at 29 to buy Chevron
Netherlands? How many Nigerians can ever say they were in a competitive
bid to buy an oil & gas company in Europe and almost won? How many
young men at your age with the same background, simply settle for less?
But you went out into the real world and fought hard and fought
valiantly. You got one of the largest indigenous Dutch oil companies and
the Dutch state-run oil company to partner with you. You might have
lost but you won. Take this as a privilege and that God himself is
shaping you into a Man and not just any Man.” He was right and I agreed.
Heisenberg advised that I head off to the one place that always
rejuvenates my soul… Los Angeles. I got up out of bed, walked down into
my study, went online and bought a ticket for the next morning’s flight
to Los Angeles. I would go away for two months.
I arrived in Los Angeles half a day later. I sat in my apartment
for the first two days. I barely ate and just stared into nothing. This
was the cathartic process to get over my loss. Then I got into my car
and drove to Malibu. There is nothing more peaceful than a scenic drive
down the Pacific Coast Highway (PCH). The Pacific Ocean waters out to
infinity on your left and there are cliffs, bluffs, and stunning
mountains to your right. The California sun in all its warmth shines
down and that good Cali fever infects your soul. This was
Californication at its finest. I enjoyed my two months in Los Angeles. I
partied hard, went to the Drake vs. Lil Wayne concert at the Hollywood
Bowl, sat courtside and watched Kobe Bryant of the Los Angeles Lakers
play a good game, ate well and one night dined at BOA steakhouse on
Sunset – at the table in front of me was an orange haired business man
named Donald Trump, if only I had a crystal ball then. I went to
Disneyworld and had a blast. California had healed me. I was okay again.
I thanked God not only for the opportunity and the experience but also
for blessing me with a good life. He had taught me some valuable lessons
and helped me discover new parts of myself I didn’t know existed.
Heisenberg was right, I was becoming a Man in the true sense of the
word.
A year later, I moved back to Lagos for a few months to be closer
to my family and to take a break from work. A South African company,
HKLM that had helped my father design the logo for his telecoms company
were in Lagos doing some further design work for my father. My father
always uses a bull as his personal insignia and it had become synonymous
with him. Gary Harwood of HKLM asked me if I wanted my father’s bull
insignia adorned on any clothing or stationery. I told Gary that I
wasn’t a bull and that my father was “the bull”. Gary countered and
said, “Well Paddy if you are not a bull, then what are you?” I paused
for a moment, thinking. My mother was born on August 2nd, 1950; she is a
Leo by star sign. Leo’s are lions and I was my mother’s lion son, her
Simba. I told Gary, “I am a Lion. I always have been and always will
be.” Two weeks later Gary sent me a design of my own personal insignia,
it was a Lion’s head. We made a few tweaks to make the Lion look more
intimidating yet regal and Gary sent me the final design. In a very
clever and touching way, Gary and his team had woven some of my facial
features into the design of the Lion’s face. This Lion no matter who
might see it or who might copy it would have me staring right back at
them. I thanked him for a wonderful present.
I called Remi and told him that I was back in Lagos. He invited me
over to his palatial and modern home. He liked my Lion’s head insignia
that I had stitched onto the pocket of my native Nigerian kaftan. We sat
down for hours and talked business and politics. Then Remi asked me
what was I doing in London all that time, away from the family business.
I was happy to tell him about Chevron Netherlands at this point, the
deal was done and over. Remi looked at me in astonishment, “You mean you
took on a whole Chevron, with no noise, no fanfare and none of us knew?
Ahh bros you try!” We laughed it off. Remi then revealed the biggest
bombshell of my Chevron Netherlands adventure. The managing director of
Petrogas of Oman was a close friend of his and he knew he was bidding
for Chevron Netherlands at the time. If I had told him what I was up to
when we saw in London, whilst I was searching for the last bidder, he
would have introduced us. I was blown away. There it was that whole
time. That mystery last bidder that I had searched so hard for was there
for my taking and it passed right by me.
I went back home that night and made myself the strongest drink. History couldn’t tell this story. I would have to.
*******
By Paddy Adenuga
No comments:
Post a Comment