Safripol produces high-density polyethylene, polypropylene and compounded polypropylene for the plastics converting industry.
Speaking on the sidelines of an event celebrating the conclusion of a black economic empowerment transaction with Thebe Investment Corporation, which has acquired a 21% stake in Safripol, Schoch said that it would leverage off its technology relationship with Basell, which was the largest global company with a production line of 12-millon t/y of polyolefins to increase capacity.
To satisfy current customer needs, it was essential to grow the business by between 8% and 10% a year.
“We have to be able to increase supply to keep up with customer demands, which are increasing yearly, and be globally competitive,” Schoch said.
Safripol was involved in very little export activity and was concentrating on meeting local needs and would only look to the export market, if there was a quantum increase in capacity.
Safripol produces 300 000 t of polyethylene and polypropylene a year, compared with the global market production of 100-million.
Thebe Investment Corporation Vusi Khanyile said that the company would assist Safripol increase its customer base “through accessing the markets it was currently not in”.
Safripol was bought from Hoechst SA and Sentrachem by The Dow Chemical Company in 1999, and in turn, at the end of 2006, sold the business to a South African consortium comprising Absa Capital and the management team.
Together with the BEE shareholding at the Absa Group level where the Batho Bonke consortium holds 10% of the equity, the acquisition gives Safripol more than the 25% plus one share guideline for BEE companies.
Khanyile and Lindiwe Gadd of Thebe will join the Safripol board of directors, together with the representatives of Absa Capital and the management shareholders.