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Sasol - Women The Major Beneficiaries In Sasols Significant R1,5 Billion

Release Date: 22/09/2005 14:30:00      Code(s): SOL
Sasol -   Women the major beneficiaries in Sasol"s significant R1,5 billion     
          empowerment transaction                                               
Sasol Limited                                                                   
(Incorporated in South Africa)                                                  
(Registration number: 1979/003231/06)                                           
ISIN Code: ZAE000006896                                                         
Share Code: SOL                                                                 
NYSE Code: SSL                                                                  
("Sasol")                                                                       
Women the major beneficiaries in Sasol"s significant R1,5 billion empowerment   
transaction                                                                     
South African energy and chemical company Sasol today announced that Tshwarisano
LFB Investment (Pty) Limited (Tshwarisano), its broad-based black economic      
empowerment (BEE) partner, would acquire a 12,5% interest in Uhambo Oil Limited 
(Uhambo Oil) for an amount of R 1,45 billion. The Uhambo Oil transaction is     
subject to Competition Tribunal approval.                                       
Sasol is providing considerable facilitation and support for Tshwarisano"s      
financing requirements, which amount to about R1,1 billion. Sasol has provided  
guarantees for this debt and has agreed not to recover guarantee fees, all of   
which will significantly lower Tshwarisano"s cost of borrowing. In addition,    
Sasol is contributing R45 milion to two trusts, aimed at empowering the severely
underprivileged, as well as Uhambo Oil staff and their families.                
"These initiatives are aimed at reducing financing costs and improving the long-
term business benefits that will accrue to Tshwarisano"s broad base of          
empowerment shareholders," says Sasol CE Pat Davies. "Sasol views transformation
in South Africa as a strategic business and moral imperative. We aspire to      
advancing our empowerment initiatives in ways that are sustainable, credible and
of benefit to the Sasol group, all our stakeholders, and the country as a       
whole," he adds                                                                 
This follows the joint announcement by Sasol and Petronas of Malaysia in        
November 2004 where the companies outlined plans to merge their respective      
liquid fuels businesses, subject to the approval of the competition authorities,
into a large and robust joint entity to be named Uhambo Oil Limited. The joint  
venture was proposed between the Sasol Liquid Fuel Business (previously Sasol   
Oil), and Engen, the Southern African fuel company controlled by Petronas.      
"After concluding and signing definitive agreements for this proposed merger, we
have been able to advance our empowerment plans in the liquid fuels business. As
a result, we are pleased to announce the formation of an empowerment partnership
with Tshwarisano . Tshwarisano will acquire a 12,5% interest in Uhambo Oil, if  
the pending merger between our liquid fuels business and Engen is approved by   
the Competition Tribunal," says Davies.                                         
Other shareholders in Uhambo Oil will be Sasol and Petronas, both with 37,5%,   
and Petronas" empowerment partner Afric Energy Resources with 12,5%. Competition
Tribunal hearings on the proposed joint venture take place next month.          
 If, for any reason, the Competition Tribunal does not rule in favour of the    
merger, then Tshwarisano will become a 25% shareholder in Sasol"s liquid fuels  
business rather than a 12,5% shareholder in Uhambo Oil.                         
The Empowerment Partners                                                        
Tshwarisano is a broad-based consortium comprising many historically            
disadvantaged groups. Promoted by Dr Penuell Maduna, Ms Hixonia Nyasulu and Mr  
Reuel Khoza, who, through various businesses, will collectively hold about 30%  
of equity in Tshwarisano, other key shareholders owning the majority 70% of     
equity include:                                                                 
PulaNala, an Mpumalanga-based consortium comprising various 100% black-owned    
groupings and associations. These include the Embalenhle Association for the    
Aged, the Basizeni School for the Disabled, Phakamani Women"s Projects, Youth   
for Revolution of Goodwill, the Zimeleni Disabled Association and the Thanda    
Empowerment Trust, which has a presence in 30 Mpumalanga townships;             
Lelethu Energy and Mineral Group which comprises many 100% black-owned groups   
mainly domiciled in the Eastern Cape. These include Kholekani Investments, the  
Early Bird Sewing project, the Masibambane Disabled Centre, the Galacia         
Investment Trust and the Ikwezi Youth Development. Nearly 80% of this group is  
represented by women;                                                           
Tswelopele Mineral and Energy Holdings which includes various 100% black-owned  
groups such as the Uphaphe Empowerment Trust, Kopano Utilities and Resources (a 
Cosatu investment company) and Libalele Property Enterprises, an urban women"s  
group.                                                                          
Amandl"Embokodo is a wholly black-owned women"s consortium with about  1 400    
direct beneficiaries and an estimated 250 000 indirect beneficiaries. The main  
groups involved include Dyonodisani Women in Oil, Gas and Energy (Pty) Limited, 
Fukama Trust, Helping Hand Investment Holding (Pty) Limited, Motsheo Trust and  
African Women in Mining and Energy Focus.                                       
previous Exel shareholders will hold about 47% of the equity in Tshwarisano.    
Major participants include Nozweni (Pty) Limited, the Autoworkers provident and 
pension funds and Phakisang Investments (Pty) Limited.                          
Nozweni is jointly owned by the Nozala Trust and Nozala Resources. The Nozala   
Trust is established for the benefit of about 500 000 needy and mostly rural    
women. Nozala Resources is represented by a number of prominent business women  
and contributes 20% of its dividends to the Nozala Trust for upliftment         
programmes.                                                                     
The Autoworkers provident and pension funds have about 145 000 members who      
mostly work in retail fuel service stations. More than 98% of the beneficiaries 
of these funds are black people.                                                
Phakisang Investments is represented by previous long-serving shareholders in   
Exel who have had, or continue to have, investments in retail fuel service      
stations.                                                                       
Sasol is also establishing the Batho Trust within Tshwarisano for the benefit of
the severely under-privileged and poor. "We will facilitate R30 million to its  
formation.  Independent trustees will be appointed to administer this trust on  
behalf of the beneficiaries," says Sasol deputy CE Trevor Munday.               
He adds that Sasol is also contributing another R15 million to the establishment
within Tshwarisano of an Uhambo Employees Trust for the intended benefit of     
Uhambo Oil employees and their families. "Petronas has confirmed its intention  
also to contribute to this employees" trust," says Munday.                      
"We are particularly pleased about the broad composition profile of Tshwarisano.
The direct beneficiaries of Tshwarisano number many hundreds of thousands of    
historically disadvantaged South Africans. More than 50% are women. The indirect
beneficiaries number an estimated three million people," says Tshwarisano       
chairman Dr Penuell Maduna. He adds that beneficiaries also include the youth,  
the disabled and rural communities.                                             
Maduna, who as Tshwarisano"s lead promoter worked with Sasol to structure the   
broad-based empowerment consortium, says that by providing its balance sheet as 
a guarantee for the debt financing, Sasol"s empowerment shareholders are in a   
much stronger position to accrue considerable long-term business benefits.      
"Sasol has ensured that this is a sustainable empowerment transaction," says    
Maduna.                                                                         
"Traditionally, in all the BEE deals done so far, women have been an after-     
thought. The difference here is that women are leading the deal - 54% of the    
value of the deal goes to women beneficiaries," says Tshwarisano promoter       
Hixonia Nyasulu.                                                                
The facilitation by Sasol                                                       
Sasol has worked with the promoters and advisors of Tshwarisano for about a year
to develop this empowerment transaction, says Munday. He adds that the specific 
objectives of the transaction were to ensure that:                              
-    it will be enduringly broad-based with a high proportion of women          
participants;                                                              
-    all shareholdings will be financially secure and unencumbered as soon as   
     possible so that benefits will flow to the beneficiaries within a          
     reasonable time period; and                                                
-    the broad-based beneficiaries" shareholdings will be properly governed.    
"In pursuit of these objectives we have provided independent and ongoing        
business, financial and legal advice to the promoters and Tshwarisano," says    
Munday.                                                                         
Specifically, Sasol will:                                                       
-    through Sasol Financing (Pty) Limited, and jointly with JP Morgan and      
     Nedbank, arrange and structure the senior-debt financing required by       
     Tshwarisano amounting to about R1,1 billion;                               
-    provide guarantees for this debt to the participating banks which will     
     lower the cost of borrowing to be incurred by Tshwarisano during the debt  
     term by an estimated R450 million;                                         
-    waive and not recover guarantee fees which would normally be charged to the
beneficiaries resulting in a further benefit to Tshwarisano of R170        
     million; and                                                               
-    pay advising, arranging and structuring fees to Tshwarisano"s advisors     
     amounting to about R80 million.                                            
"The total financial facilitation and support provided by Sasol amounts to      
nearly R1 billion, of which R620 million is provided through the benefit of     
guarantees," says Munday. "The balance is provided through payment of           
Tshwarisano costs, the formation of trusts and the discount from full valuation 
provided to Tshwarisano for its shareholding."                                  
Munday says that this discount recognises the value its participation offers    
Sasol in terms of business sustainability and future credibility in South       
Africa. "It is envisaged that considerable longer term business benefits will   
accrue to shareholders as a result of this discount and the empowered status of 
Uhambo Oil, or should the joint venture not be allowed, Sasol"s liquid fuels    
business."                                                                      
Nyasulu adds: "The Sasol guarantee means that the banks will lend to Tshwarisano
at about the same rate that they would have lent to Sasol."                     
Uhambo Oil: the business Tshwarisano is investing in                            
Subject to the approval by the Competition Tribunal, the planned merging of     
Sasol"s liquid fuels business with Engen to form Uhambo Oil will result in the  
largest liquid fuels business in South Africa.                                  
Supported by component supplies from Sasol"s synthetic fuels facilities at      
Secunda, Sasol"s share of the Natref crude oil refinery in Sasolburg and Engen"s
crude oil refinery at Durban, Uhambo Oil will produce about 48% and market about
34% of South Africa"s liquid fuels. Uhambo Oil will market fuel to retail and   
commercial customers throughout the continent. It will comprise some 1 600      
retail service stations branded as Engen, Sasol and Exel. The joint venture will
have operations in 14 African countries and its geographic scope will include   
the whole of sub-Saharan Africa.                                                
The joint venture is considered to be a merger of equals. It will be a business 
with substantial scale that will provide opportunities for significant synergies
and efficiencies.                                                               
Tshwarisano will benefit from the value-chain benefits and combining of skills  
and strengths that the formation of Uhambo Oil will offer, subject to the       
approval by the Competition Tribunal. It will take part in all the synergies    
derived from the proposed merger of Sasol and Engen - from the production and   
fuel refining businesses right through to the retail forecourts throughout sub- 
Saharan Africa.                                                                 
"Tshwarisano means `pulling together" in Sesotho. This is an apt name for our   
empowerment partner for our liquid fuels business. Jointly we will pull together
to grow the South African economy and `reach new frontiers"," says Davies.      
22 September 2005                                                               
Johannesburg                                                                    
Issued by sponsor: Deutsche Securities (SA) (Proprietary) Limited               
Date: 22/09/2005 02:30:11 PM Supplied by www.sharenet.co.za                     
Produced by the JSE SENS Department                                             
                                                                                
                                                                                
                                                                                



                                        
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