Share

PIC said to mull backing bid for Chevron's SA unit

Johannesburg - The Public Investment Corporation (PIC) is interested in taking part in the acquisition by Glencore and a group of black South African-owned companies of Chevron's assets in South Africa, according to three people familiar with the matter.

The PIC which manages the pension funds of South African government workers, could buy a portion of the business from Glencore or the minority owners, said one of the people, who asked not to be identified because the plans aren’t public.

The three parties could then raise cash by selling shares in the company on the Johannesburg Stock Exchange, the person said.

The PIC manages about R1.9trn trillion in assets and owns stakes in the majority of South African listed companies. The Chevron unit owns a 100 000 barrel-a-day refinery in Cape Town and more than 800 gas stations in the country and Botswana.

Chevron originally agreed to sell its 75 percent shareholding in the southern African business to China Petroleum & Chemical Corp. for $900m (about R12.2bn). However, the deal stalled after black-owned minority partners including African Legend Investments exercised a preemptive right on the stake. They brought in Glencore as an alternative buyer, and the Swiss trader agreed to the $973m (R13.1bn) deal on October 6.

The successful bid led by black investors aligns with the government’s aim to boost black participation in the economy that is dominated by white and foreign-owned businesses 23-years after apartheid.

Proposal Made

Glencore is interested in selling down the stake to reduce the size of its financial commitment, a person familiar with the matter said last week. The company intends to limit net capital expenditure across its oil business to less than $500m (R6.7bn) over the next 12 months, it has said.

The PIC said in a statement that, while it has been approached with a proposal to invest in Chevron, "no investment decision has been made”. 

Glencore and African Legend Investments declined to comment. Chevron and China Petroleum & Chemical Corporation didn’t immediately respond to emailed questions.


SUBSCRIBE FOR FREE UPDATE: Get Fin24's top morning business news and opinions in your inbox.

Read Fin24's top stories trending on Twitter:

We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
18.92
-0.1%
Rand - Pound
23.90
-0.0%
Rand - Euro
20.44
+0.1%
Rand - Aus dollar
12.35
+0.0%
Rand - Yen
0.13
-0.1%
Platinum
909.30
+1.4%
Palladium
1,015.00
+1.3%
Gold
2,220.40
+1.2%
Silver
24.86
+0.9%
Brent Crude
86.09
-0.2%
Top 40
68,346
+1.0%
All Share
74,536
+0.9%
Resource 10
57,251
+2.9%
Industrial 25
103,936
+0.6%
Financial 15
16,502
-0.1%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders