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Johannesburg - Sasol's risk premium may have increased following the penalty imposed on it for anti-competitive behaviour by the competition commission, an analyst said.
The commission has increased the penalty for cartel conduct in Sasol's fertiliser business from R188m to R251m.
"Even though this new penalty is not that material (representing 8% of turnover of its nitro division), it does increase the risk premium of the company as a whole," said Liston Meintjes of Abercrombie Investment Managers.
The fine has been increased due to another set of claims that Sasol's nitro division had taken part in anti-competitive behaviour.
After a five-year investigation, Sasol left it until Monday to admit that it had committed further anti-competitive practices.
This includes meetings of Sasol Nitro, Omnia and Kynoch (now Yara) to fix prices and agree discounts.
The commission said in a statement that while its approach to settlement is to incentivise timeous and full disclosure of conduct as part of co-operation, "this conduct has been revealed by Sasol extremely late in the day".
As a result, Sasol has agreed to pay a higher penalty.
After initial pressure following news of the fine, the petrochemical giant's share price has bounced back.
But ultimately, this kind of news results in bad press and publicity for management, said Meintjes.
- Fin24.com