Savannah Energy announces relationship agreement with NIPCO, terminates share buyback plan

Savannah Energy Plc, the British independent energy company focused on Africa, has announced plans to enter into a relationship agreement with its largest shareholder, NIPCO Plc, following NIPCO’s intention to increase its equity stake in the company.

In a statement, Savannah said NIPCO, a diversified Nigerian energy conglomerate, proposes to acquire additional ordinary shares in the company through a series of secondary market transactions. As part of the arrangement, Savannah will terminate the off-market share buyback agreement announced on October 22, 2025 and approved by shareholders on November 28, 2025.

Following the termination of the buyback agreement, NIPCO plans to acquire 118,083,927 of the 143,565,582 ordinary shares originally earmarked for the buyback. This would increase NIPCO’s shareholding to about 25% of Savannah’s issued share capital. NIPCO has also indicated its intention to acquire up to a further 1.5% of the company’s shares through additional secondary market purchases from identified shareholders, potentially raising its stake to approximately 26.5%, subject to completion.

Savannah said the proposed relationship agreement is intended to safeguard the company’s operational independence and protect minority shareholders. The agreement is expected to include undertakings by NIPCO to support board-recommended governance resolutions, confirmation that NIPCO will have no right to board representation, a commitment not to pursue a hostile takeover of the company (subject to limited exceptions), and orderly market disposal obligations for any future share sales.

The agreement is expected to remain in force for as long as NIPCO and its affiliates hold at least 12.5% of Savannah’s issued share capital. Entry into the agreement is expected shortly, subject to regulatory consultation.

The Savannah board said the decision to terminate the buyback agreement would preserve approximately £10.05 million in cash, improving financial flexibility while retaining the company’s ability to return capital to shareholders through board-approved on-market buybacks.

Meanwhile, Savannah’s Chief Executive Officer, Andrew Knott, plans to acquire the remaining 25,481,655 ordinary shares that were subject to the buyback agreement but not being acquired by NIPCO. This would increase his total shareholding to 292,764,370 ordinary shares, representing about 13.8% of the company’s issued share capital. The board described the move as a demonstration of management’s confidence in the company’s strategy and future prospects.

Savannah noted that the termination of the buyback agreement and the proposed relationship agreement constitute related party transactions under the AIM Rules for Companies. The company’s independent directors, after consulting with Strand Hanson Limited, its nominated adviser, concluded that the arrangements are fair and reasonable in the interests of shareholders.