Sinopec to acquire Chevron South Africa
Sinopec’s SOIHL HK has been given the green light to acquire 75% of Chevron South Africa (Pty) Ltd (CSA) for $900m by the country’s competition commission.
CSA is owned 75% by Chevron Global Energy Inc., which is ultimately controlled by Chevron Corporation. In South Africa, CSA refines and produces petroleum products at its Cape Town refinery and lubricants blending plant in Durban. It is also involved in marketing and distributing petroleum products and in commercial wholesale, marketing and distribution petroleum products. CSA competes with other oil companies such as Engen, BP, Shell, Total and Sasol.
In a press release outlining its decision the commission said: “The proposed transaction is unlikely to substantially prevent or lessen competition in any of the identified markets. However, in order to alleviate any possible loss of employment post-merger as well as any potential impact on CSA’s retired employees, and in respect of other public interest issues raised by the Department of Economic Development, the Commission recommends that conditions be imposed which address the identified public interest concerns.”
Sinopec has agreed to make certain undertakings to ensure that the transaction generates public interest benefits for South Africa, while promoting the efficiency, adaptability and development of the economy. Sinopec will establish its head office in South Africa and no employees will be made redundant as a result of the acquisition. The company will also invest in the Cape Town refinery; CSA’s wholesale and retail chains; by-products and logistics and local procurement.
8th Jan 2018