The Anglo–Swiss multinational commodity trading and mining company Glencore entered into an agreement to purchase a 75% stake in Chevron South Africa Proprietary Limited and 100% of Chevron Botswana Proprietary Limited. The transaction will be funded using existing cash resources and is expected to close by mid-2018.
The assets included in the deal worth US$973m and entail Chevron's 100,000 bbl/d oil refinery in Cape Town along with lubricants-manufacturing facilities in Durban (South Africa) and a network of more than 820 retail-gas outlets and petrol stations in South Africa and Botswana. Chevron is South Africa's second supplier of petroleum products (petrol, gasoline) with a market share of around 19%.
Chevron previously agreed to sell the assets to China Petroleum & Chemical Corp but the deal unravelled in September 2017 when a consortium of South African black economic empowerment shareholders (BEE, Off The Shelf Investments Fifty Six Proprietary Limited) and an employee trust, who own 25% of the assets, exercised their preemption right in the sale process. Once the current transaction is complete, Glencore will own 75% of the assets while Shelf Investments Fifty Six Proprietary Limited will retain the remaining 25% stake. Foreign companies operating in South Africa are required to have a BEE partner, which needs to have at least a 25% interest in the business.
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