SOL - Sasol Limited - Sasol`s sale of 20% in mining subsidiary to black Release Date: 11/10/2007 07:00:02 Code(s): SOL
SOL - Sasol Limited - Sasol`s sale of 20% in mining subsidiary to black
women for R1,9 billion will meet Mining Charter`s ownership requirements and
lead the way for women in mining
(Incorporated in South Africa)
(Registration number: 1979/003231/06)
JSE Code: SOL ISIN Code: ZAE000006896
NYSE Code: SSL ISIN Code: US8038663006
("Sasol" or "the Company")
Sasol`s sale of 20% in mining subsidiary to black women for R1,9 billion
will meet Mining Charter`s ownership requirements and will develop women in
Details of transaction
Sasol Mining, the wholly-owned subsidiary of Sasol Limited, today announced
the formation of a black-women controlled coal mining company called Ixia
Coal (Pty) Limited. In a transaction valued at almost R1,9 billion, Ixia
Coal will acquire 20% of Sasol Mining`s shareholding through the issue of
new shares. Ixia Coal is a venture with Women Investment Portfolio Holdings
Limited (WIPHOLD) and Mining Women Investments (Pty) Limited (Mining Women
Investments), a newly established company comprising women drawn from the
areas where Sasol Mining has operations and coal reserves.
Heralding the second phase of Sasol Mining`s broad-based black economic
empowerment (BEE) strategy, this transaction enables Sasol Mining to achieve
compliance with the Mining Charter`s ownership requirements.
The first phase of Sasol Mining`s BEE strategy was the creation of Igoda
Coal (Pty) Limited, a coal export venture with Eyesizwe Coal announced in
March 2006. Now, with the formation of Ixia Coal, Sasol Mining`s BEE
ownership component will increase to an estimated 26% (calculated on
attributable units of production) well before the 2014 deadline.
Sasol executive director responsible for the South African energy
businesses, Dr Benny Mokaba says: "This transaction not only achieves
compliance with the Mining Charter, but also promotes women in mining. We
want to create lasting empowerment by providing opportunities for our
country`s women to enter and benefit from the traditionally male-dominated
mining industry. Our focus will be on developing relevant skills and
building capacity among historically disadvantaged women."
Mokaba adds: "Our intention is to create a lasting legacy through skills
development and capacity building in support of government`s socio-economic
objectives. This announcement is another step in our over-arching ambition
to empower a broad-base of historically disadvantaged South Africans by
advancing initiatives that are sustainable, credible and of benefit to both
stakeholders and our country."
Controlled by black women, Ixia Coal will become an investor in Sasol
Mining. Over the longer term Ixia Coal, with the assistance of Sasol Mining,
will also develop operational capacity enabling the company to operate its
own coal mines.
"We partnered with WIPHOLD because of the role that we together can play in
developing a new women`s mining group. With sound business acumen and a
strong empowerment track record, WIPHOLD will help us build Ixia Coal into a
new, sustainable women`s empowerment company that over time will become
involved in operating coal mines. This will include transferring skills to
the new company," says Sasol Mining MD Hermann Wenhold.
Mining Women Investments, the new entrant, is comprised of thousands of
rural black women, who have not previously been empowered. The group has
been constituted by WIPHOLD, following a series of workshops held with women
in the Free State, Mpumalanga and Limpopo provinces, where Sasol Mining has
operations and coal reserves.
WIPHOLD is an investment and operating company owned and managed by black
women, with interests in a range of industries. Founded in 1994, it is
dedicated to the empowerment of women. Represented countrywide, it has 1 200
direct female beneficiaries and, through non-governmental organisation
shareholders, an estimated 200 000 women as indirect beneficiaries.
Sasol Mining will also benefit from the proposed 10% BEE transaction at Sasol
Limited level, which if approved by shareholders will be implemented in 2008
and will take Sasol Mining beyond compliance with the Mining Charter`s
"The transaction has been concluded at fair value. The facilitation cost to
Sasol is anticipated to be commensurate with other BEE deals in the mining
sector in South Africa and will only be finalised once third party funding
arrangements are in place," says Sasol chief financial officer Christine
Sasol Mining is in the process of converting its mining rights as required
by South African minerals legislation. The transaction agreements were
signed on 4 October 2007 and are expected to be completed in 2008 subject to
fulfilment of the following conditions:
- conversion of Sasol Mining`s mining rights and obtaining the requisite
regulatory approvals; and
- conclusion of the financing agreements with third party lenders.
To enable the transaction, Sasol will establish a new wholly-owned
subsidiary, Sasol Mining Holdings (Pty) Limited (Sasol Mining Holdings),
which will hold 80% of Sasol Mining.
Sasol Mining Holdings will have a 49% ownership in Ixia Coal. The other 51%
will be owned by WIPCoal Investments. WIPHOLD will be the majority
shareholder in WIPCoal Investments, with 60% shareholding. The other 40%
shares will be owned by Mining Women Investments. Ixia Coal will be
independently controlled and separate from Sasol Mining.
Ixia Coal, through an investment company called BEE Holdco (Pty) Limited
(BEE Holdco), will hold 20% in the issued share capital of Sasol Mining. BEE
Holdco will raise the required funding for the transaction. WIPHOLD and
Mining Women Investments, through their investment in Ixia Coal, will from
inception have full voting and economic rights associated with BEE Holdco`s
interest in the issued share capital of Sasol Mining.
Ixia Coal`s 20% shareholding in Sasol Mining is valued at R1 855 million,
taking into account Sasol Mining`s future expected cash flows, capital
investment requirements and an appropriate level of debt. The transaction
will be financed through equity (R59 million) and a combination of third
party funding and appropriate Sasol facilitation. It is currently envisaged
that approximately 40% of the transaction will be funded through third party
debt; however this is dependent on market conditions prevailing at the time.
11 October 2007
Issued by sponsor: Deutsche Securities (SA) (Proprietary) Limited
Sasol Disclaimer - Forward-looking statements
We may in this document make statements that are not historical facts and
relate to analyses and other information based on forecasts of future
results and estimates of amounts not yet determinable. There are forward-
looking statements as defined in the U.S. Private Securities Litigation
Reform Act of 1995. Words such as "believe", "anticipate", "expect",
"intend", "seek", "will", "plan", "could", "may", "endeavour" and "project"
and similar expressions are intended to identify such forward-looking
statements, but are not exclusive means of identifying such statements. By
their very nature, forward-looking statements involve inherent risks and
uncertainties, both general and specific, and there are risks that
predictions, forecasts, projections and other forward-looking statements
will not be achieved. If one or more of these risks materialize, or should
underlying assumptions prove incorrect, actual results may be very different
from those anticipated. The factors that could cause our actual results to
differ materially from the plans, objectives, expectations, estimates and
intentions expressed in such forward-looking statements are discussed more
fully in our annual report under the Securities Exchange Act of 1934 on Form
20-F filed on November 2, 2006 and in other filings with the United States
Securities and Exchange Commission. Forward-looking statements apply only as
of the date on which they are made and Sasol does not undertake any
obligation to update or revise any of them, whether as a result of new
information, future events or otherwise.
Date: 11/10/2007 07:00:02 Supplied by www.sharenet.co.za
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