Meet Tanzanian 36- Years Old Who Build 1 Billion Us Dollar Oil Company
On a crisp late May afternoon in Dar es Salaam Ally Awadh, one of Tanzania’s most prominent businessmen, is waxing lyrical about a deal he has just concluded. Recently, the Competition Authority of Kenya gave his company, Lake Oil Group, the go-ahead to acquire all the fuel service stations of Hashi Energy, one of Kenya’s largest independent oil companies
“It’s a first step for us in our pursuit of regional domination,” says the 36-year-old mogul in lightly accented but supple english. “Once you conquer Kenya as a foreign company, then you shouldn’t really have much of a problem prospering in other East African countries.”
Dressed in a black T-shirt, jeans and handmade black loafers, Awadh’s look may be unpretentious. His ambitions are anything but. In less than a decade the young founder and CEO of Lake Oil Group has built his company into a $1 billion (revenues) integrated energy solutions provider, and he’s not resting just yet.
Lake Oil Group, which Ally Awadh founded in 2006, is one of East and Central Africa’s fastest growing energy trading and transportation conglomerates. The company is now one of the 5 largest distributors of petroleum products in Tanzania.
Lake Oil Group also distributes and trades fuel products in Zambia, DRC, Burundi and Rwanda; owns its own oil storage facilities in Tanzania and the Democratic Republic of Congo; manufactures lubes and Ready Mix Concrete Segment, and operates a fleet of more than 400 tankers. Lake Oil Group also has trading operations and gas stations in Rwanda, Burundi, Mozambique, Uganda, Canada and United Arab Emirates.
Ally Awadh was born in 1980 to a family of successful entrepreneurs. His father built a considerable fortune trading agricultural commodities in Tanzania, and as a result Awadh attended the prestigious and exclusive International School of Tanganyika for his High School studies before proceeding to Brock University, Canada, where he studied Business Administration.
“My father basically got tired of me always calling him to ask for more money, so one day he bluntly told me on the phone that I was an adult, and if I wanted any money, I needed to start working for it. It was a reality check for me,” Awadh recalls.
Awadh soon got a job flipping burgers at McDonalds after study hours. “This was a turning point for me,” he muses. “For the first time, I was having to serve people. I was taking orders, handing people their food with a smile, building up on my people skills and just learning how to connect with customers. But more importantly, I was earning my own income, saving and building a nest egg for the future.”
After completing his studies in Canada, Awadh started importing used clothes from Canada to sell in Tanzania. Before long, his second-hand clothing business, which is popularly referred to in Swahili as ‘Mitumba Biashara’ prospered.
“I doubled my money on the first consignment, and I kept replicating it over a period of time. That’s how we built up capital in the business. Before long, I had accumulated a very substantial amount of money, and I was only 23 at the time,” Awadh says.
To consolidate, Awadh soon ventured into the importation of used and refurbished Trucks to Tanzania from the United Kingdom. Simultaneously, he started a milk processing facility which he subsequently sold. By the time he was 25 Awadh had already become a millionaire in American dollars.
At the age of 26, Awadh approached the Petroleum Bulk Procurement Agency (PBPA) in Tanzania and applied for a license to import refined petroleum products. He laughs when he recollects his encounter with an employee at the agency.
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“I was clearly very young and so when I went to the PBPA and asked them to give me a license, this particular guy sized me up and told me I was not serious. He could not believe that someone so young wanted to get involved in the bulk oil import business. But then he looked at our balance sheet and our track record in business, and we clearly had the capacity to play in this business.”
In 2006 Lake Oil Group was born. Awadh assembled a team and began importing fuel products to Tanzania, distributing to gas stations. As he built up his balance sheet, he was able to raise loans from local and international banks which he used to build up oil storage terminals across Tanzania. He also started buying up retail stations and setting up new ones across rural regions in Tanzania.
“As much as possible, we try to focus on constructing our retail stations in up-country areas, rather than focusing only on the urban areas. It has been an extremely successful model for our business. While most companies are looking to have fuel stations in the city centers and the more bustling urban parts of Tanzania, we’ve decided to take the road less taken. We are now also developing fuel stations in Rwanda, Burundi, DRC, Zambia, Malawi and Zimbabwe.”
Awadh is also a major player in Tanzania’s transport sector. Lake Trans, his transportation subsidiary, is one of the largest trucking and haulage companies in Tanzania. “Our venturing into transportation was born out of necessity.
We figured out early on that if we wanted to distribute our products to every nook and cranny of Tanzania, we had to invest in our own distribution. So over time, we have acquired a fleet of more than 400 trucks.” While Lake Trans primarily services the needs of Awadh’s primary businesses, Lake Oil leases it on occasion to other businesses.
Today, Lake Group plays an important function in the lives of many Tanzanians. The company is widely credited for popularizing cooking gas among Tanzania’s rural population. Its cooking gas subsidiary, Lake Gas, is the undisputed market leader in Tanzania and is breaking into to Uganda, Zambia, DRC and Rwanda. Lake Gas recently completed a state of art Gas storage terminal in Tanga, Coastal Town of North Tanzania.
Ally Awadh has built Lake Oil Group into a stunning African success story, but he is quick to attribute his success to his employees. “A company is only as good as its people,” he says. Awadh makes it a point to personally interview every managerial-level employee at his company, and he allows any manager have access to him at any time.
Ally Awadh is still as ambitious as ever. Despite building the most successful indigenous oil marketing company in Tanzania, he still has his sights set on new ventures. Lake Oil Group has established Middle East Ready Mix LLC, a company that produces durable and non-durable concrete that is used for piling, foundations and structures. The company has plants in Dubai AND Tanzania.
Lake Group is also working to establish a Truck assembly yard together with a foreign partner on a Joint Venture basis, and Awadh has recently invested in a Steel Plant at Kibaha, Tanzania and it will be commissioned before the end of 2017. He is also looking to expand his business tentacles into agriculture, farming and Agro process industries in the near future.
The young businessman is one of Tanzania’s biggest philanthropists. Through the Lake Oil Foundation, Awadh spends hundreds of thousands of dollars every year granting scholarships to impoverished Tanzanians and rehabilitating schools and Hospitals.
“My idea is to build Lake Group into a Pan-African diversified conglomerate by the year 2025, employing more than 15,000 people. I believe it’s possible, and as long as God lives, I am unstoppable,” Ally Awadh says.
Source: Forbes
