Ottapathu defends Fusion Spark’s Engen bid

Choppies Chief Executive Officer Ramachandran Ottapathu has defended his involvement in Fusion Spark’s proposed acquisition of 70 percent of the issued shares in Engen Botswana, insisting that his mino rity role in the transaction is purely financial and does not represent an attempt to influence the country’s fuel industry.

Speaking to t he Business Weekly & Review after Tuesday’s public hearing by the Competition and Consumer Authority (CCA), Ottapathu repeatedly rejected suggestions that his investment in Fusion Spark could give him undue influence over Engen’s operations.

“It is a passive financial investment,” he said. “I don’t operate any businesses. My main operating businesses are Choppies and The Far Property Company.”

His comments follow concerns raised during the hearing that his interests across retail, property and fuel-related investments could potentially give him influence beyond that of an ordinary shareholder.

However, Ottapathu argued that owning shares in Fusion Spark does not translate into control over Engen’s commercial decisions, particularly in an industry where supply arrangements are governed by long-term contractual relationships.

“This is a wholesale fuel distribution business,” he said. “I can’t determine whether I can supply to you or to X, Y or Z because that will be based on your contract with your fuel major.”

He said Botswana’s fuel sector operates within a structured regulatory and contractual environment, limiting the ability of individual shareholders to interfere with dealer relationships.

“If you are a Shell operator, I can’t come and sell you fuel. It is not possible. If you are an Engen operator, you buy from Engen. If you are a Puma operator, you buy from Puma. It is completely regulated.”

Some stakeholders have raised concerns that the acquisition could eventually alter the competitive dynamics of the downstream petroleum sector. Ottapathu, however, maintains that existing commercial agreements provide sufficient safeguards against such risks.

He also pointed to his history in the fuel industry, arguing that his past conduct demonstrates that he has no intention of becoming directly involved in service station operations.

“I’ve held investments in service stations for the past 14 years,” he said. “Has anyone seen me actively involved in any filling station?”

According to Ottapathu, regulators should assess his track record rather than speculate about future intentions.

Another issue raised during the hearing was whether Choppies’ convenience store brand, Choppies On The Go , could eventually replace existing retailers operating from Engen service stations.

Ottapathu dismissed the suggestion, saying there had been no discussions around such a move.

“There are 71 operators. Each one has an agreement with Engen for between 10 and 25 years. No one can interfere in that arrangement , ” he said.

He argued that dealer agreements are legally binding and cannot simply be altered following a change in ownership.

“During the term of the contract, no one can do anything. It is completely governed by the commercial laws of this country,” he said.

Asked why he chose to invest in the fuel sector, Ottapathu again rejected suggestions that the transaction represented a strategic expansion into petroleum.

“This is an investment opportunity for me to have a passive investment. A financial investment,” he said.

The interview also touched on whether Fusion Spark could eventually seek fuel import allocations currently regulated by the Botswana Energy Regulatory Authority (BERA).

Ottapathu acknowledged that the consortium could explore that possibility but said such decisions would ultimately rest with the regulator.

“That has to be determined by BERA. We don’t know that,” he said.

The CCA is expected to make a determination on the transaction within 30 days, after considering competition concerns raised by industry participants.

At the centre of the regulator’s decision is whether Fusion Spark’s proposed ownership structure represents a normal investment arrangement — as Ottapathu argues — or whether it could create broader influence in Botswana’s downstream fuel market.