R/€ = 14.23
R/$ = 10.57
Au 1306.20 $/oz
Sep 23, 2005
Sasol sells 12,5% in Uhambo to BEE groupBack
Africa|Africa Energy Resources|Energy|Engen|Exel|Petronas|Resources|Sasol|Africa|South Africa|Energy|Local Subsidiary|Synthetic Fuel Producer|Competition Commission|Hixoni Nyasulu|Pat Davis|Penuell Maduna|Ruel Khoza
© Reuse this Synthetic fuel producer Sasol has sold an effective 12,5% in Uhambo Oil - its proposed liquid-fuels joint-venture firm with Petronas - to black economic-empowerment (BEE) consortium Tshwarisano for R1,45-billion, it said yesterday.
Uhambo Oil, which will comprise a 50:50 merger between Sasol's Liquid Fuels business (ex-Sasol Oil) and Petronas's local subsidiary, Engen, is subject to approval by the Competition Tribunal, although Sasol CE Pat Davis said yesterday that the merger had received a favourable recommendation from the Competition Commission.
As a result of the empowerment transaction, Uhambo Oil will boast a 25% BEE shareholding, as Engen also brings Africa Energy Resources, also with a 12,5% stake, to the table, and Sasol and Petronas will each hold 37,5%.
Davis said that, should the merger not receive competition approval, Tshwarisano would become a 25% shareholder in Sasol's liquid fuels business on its own.
He said that Competition Tribunal hearings into the merger will begin early next month and are expected to continue for about three weeks.
Davis said that Sasol had, from the outset, striven to ensure that the empowerment deal included 'meaningful participation' of broad-based groups.
The BEE consortium is led by former Minerals and Energy Minister Dr Penuell Maduna, Ruel Khoza and Hixoni Nyasulu, who hold a collective 30,1% of equity in the Tshwarisano consortium.
The remainder is belongs to women (54%), an Uhambo employees' trust, a rural-community trust and a group of previous shareholders in Exel, Sasol's BEE fuel retail business, which include the Autoworkers provident and pension funds and a rural-women-upliftment trust.
In all, some 150 000 new shareholders will benefit from the deal.
Davis said that Sasol had contributed some R1-billion to facilitating the deal, including a R45-million equity payment to two trusts, aimed at empowering the severely underprivileged and the Uhambo staff.
It has also provided guarantees to the R1,14-billion senior debt and has agreed not to recover guarantee fees.
In a response to shareholder misgivings over whether value was being lost through the empowerment transaction, Davis said that he was confident that the deal would prove to the long-term benefit of shareholders.
Sasol's liquid fuels business's operating profit rose by 33% to R1,9-billion in the 2005 financial year to end-June, driven mainly by higher refinery margins.
If it receives competition authority approval, Uhambo Oil will be South Africa's largest liquid fuels company, with 48% of the country's refining capacity and 34% of retail market share.
Edited by: Liezel Hill© Reuse this Comment Guidelines
Other Energy News
Article contains comments
Updated 26 minutes ago This four-page brief covers key developments in South Africa’s water sector over the past 12 months, including details of South Africa’s water policy, water infrastructure, nonrevenue water and water quality issues, as well as prospects for the sector.
Recent Research Reports
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
Real Economy Insight: Road and Rail 2014 (PDF Report)
This six-page brief covers key developments in the road and rail industries over the past 12 months, including details of South Africa’s road and rail network and prospects for both sectors.
Real Economy Insight: Steel 2014 (PDF Report)
This four-page brief covers key developments in the steel industry over the past 12 months. It provides an overview of the global and South African steel and stainless steel markets, South Africa’s major steel producers and events that have shaped these markets.
This Week's Magazine
Local aerospace company Denel Aerostructures (DAe), part of the State-owned Denel Group, has won a fourth contract to manufacture parts for the Airbus A400M military air transport and air-to-air refuelling aircraft. The new contract, which was won in an international...
Although CEO Mark McChlery and chief marketing officer Bob Skinstad likened themselves to children in a playground when taking on the task of “reengineering and repositioning” the Seartec brand, the “young, dynamic and enthusiastic guys” were like proud...
An increasing number of buyers, in both the new and used car markets, are opting for finance structures that lower their monthly repayments, says asset financing company WesBank. These include the use of large balloon payments (also known as residuals), as well as...
Tertiary education institutions can use search engine giant Google’s Chromebook to provide secure mobile end-point devices for students on which they can share documents, work collaboratively on documents and access education materials and applications being used...
Local ceiling and partition company Abbeycon has beaten global competition at the Saint-Gobain Gypsum International Trophy competition, which was held last month in Berlin, Germany.