Alessandro Gilotti, CEO of Kuwait Petroleum Italia Spa (Kupit) (Q8) spoke to Italian insider's John Phillips and Lorenzo Sorbini about the company’s recent acquisitions and his vision of the future.

 Q: Italian Insider: In the context of Italo-Kuwaiti relations highlighted by the 50th anniversary of diplomatic relations between the two countries, what value does the presence of Q8 (Kuwait Petroleum) have in Italy?

 

 II: Where is it possible to see examples of the originality you mentioned?

 A.G: In our approach, which is designed to build an industrial reality of the highest level following an acquisition strategy not driven by short-term speculation interests but rather focused on obtaining a strong, competitive position in the long term. This aspect is definitely observable in the history of Kupit from 1984 when Kuwait Petroleum International (KPI) decided to expand their European presence into Italy through the acquisition of Gulf refining and marketing activities.

 Two years later, in 1986, Kupit began operating under its innovative brand “Q8”, which evokes (in its English pronunciation) the name of the country. In addition, the logo comprises two sails inspired by the ancient sea vocation and the traditional Kuwaiti sailing boats (Dhows) with colours which recall the desert sand, oil and energy. Since then, we have pursued an intense growth strategy through very important acquisitions.

 

 II: What have been the most important acquisitions made with this strategy?

 A:G: In chronological order, amongst the most important, would be that of Roloil, a leading company in the lubricants sector, in 1988. Just two years later, in 1990, Kupit made a big step forward in its history by acquiring the manufacturing and marketing assets of Mobil Oil Italiana , another historic brand in the oil business.

 In 1996, Kupit improved its logistical operations by converting its Naples oil refinery into what is now the most important coastal depot  in Italy unlinked to a refining facility. It also regained a strategic role in the Italian refining sector with the important agreement with Agip Petroli (now ENI)  for the acquisition of 50 percent of the Milazzo refinery  in Sicily. Later on there were new operations, such as the concentration all of the lubricant activity into ConqordOil and the birth of Q8 Quaser, a 100 percent owned subsidiary, operating in the Direct market.

 Last but not least the most recent important acquisition of the retail, aviation, supply and distribution assets of Shell in Italy. The specific nature of each of these acquisitions demonstrate that they have never been driven or dictated by a mere availability of the market but they are rather the result of a constant analysis of the available options aimed at achieving a competitive position in the long term.

 

 II: On June 30, 2014, you closed an extraordinary deal for the acquisition of the retail, aviation, supply and distribution operations of Shell in Italy. How much of this success  is due to the collaboration between Kuwait and Italy?

 A.G: The recent acquisition of Shell is definitely a confirmation of the trust that Kuwait puts into Italy as well as a milestone not only for the Q8 Group but also the entire oil sector. In fact,  we have now become the second operator in the Italian oil market. The new size of our company allows us to have a more productive balance between marketing and manufacturing thus enhancing the benefits deriving from the new economies of scale.

 With 3,500 service stations our network is now larger and more sustainable.  Logistically this new size makes our distribution from the depot to the service station more efficient while, from a commercial point of view, with  800 new sites acquired by Shell, Q8 has strengthen its presence by reaching an optimal geographical distribution of its service stations from North to South of Italy thus  granting a sustainable and innovative network for the benefit of consumers and the system. However, once again, the importance of this acquisition is not merely of quantity, there are important aspects of quality.

 

 II: And what are those?

 A:G: One of the most distinctive aspects of Kupit’s business approach is our choice of the sustainability as a strategic tool for competition. This approach has always driven our marketing initiatives which are focused on the knowledge of the consumers and the satisfaction of their needs by prioritising an innovative use of  technology. For example we have been pioneers in promoting in Italy the use of automated petrol filling stations,  inspired by the widespread format of fuel distribution in North Europe. Today our Q8easy represents a  network of automated petrol pumps which, by adopting the most advanced technologies, enable consumers to purchase fuel 24 hours per day, 365 days a year and with the full range of payment options, including credit and debit cards. Q8easy format also provides extremely competitive prices.

 Our focus on sustainability has also led to our particular commitment to Corporate Social Responsibility: from the strong industrial ethics which have guided our business strategy to the attention we dedicate to our relationships with the community. This results not only in promoting initiatives of social interest in the areas where we operate but, above all, in the attention we put to the environment protection and the safeguard of health and safety.  This attention is present in all of our operations and we make a constant effort to further improve in these areas.  In fact Kuwait Petroleum Italia has adopted a Corporate Policy that, by assigning specific responsibilities to its employees and contractors, systematically controls and evaluates the performance achieved in its activities in terms of environmental and health protection, safety and security, setting itself objectives of continuous improvement.

   

 II: In conclusion what kind of partner is Italy?

 A.G: In my role as the representative of the shareholders, I can confirm that we see Italy as a great friend and a market with great potential. At the same time we believe that Italy must make urgent steps towards important and substantial change.

 

 II: And what is your overall message?

 A.G: Kuwait is one of the international investors whose interest to Italy  could potentially be a determining factor for the recovery of our economy. For this reason, it is vital that Italy attracts foreign investors and, at the same time, is able to protect foreign investments.

 In order to do this we need an urgent process of reforms and simplification  of our regulatory system and procedures to make our country more competitive,  in analogy with other European countries.

 

 (This is the second interview published digitally in a series of exclusive  articles for an italian Insider Special Report to mark the 50th anniversary of relations between Kuwait and Italy commissioned by the Kuwaiti Ambassador to Italy, H.E.Sheikh Ali Al-Khaled Al-Jaber Al-Sabah)