Sasol Mulling Bid for Chevron's South African Assets
Petrochemicals firm Sasol said on Friday it was considering buying a majority stake in Chevron (CVX)'s South African assets, including a 110,000 barrels-per-day oil refinery and retail stations.
Chevron, which has had a presence in South Africa for more than a century, said in January it would sell its 75 percent stake in its business in the country after making similar sales in Nigeria due to weak oil prices.
"Sasol is working with Chevron and its advisers in this regard," spokesman Alex Anderson said in an email to Reuters.
The company, which is the world's biggest maker of fuel from coal, is slashing costs due to the plunge in oil prices by shelving major projects and cutting jobs.
Sasol owns coal mines, refineries and service stations in South Africa and exports oil to several regional countries.
"It's a strategic fit as Sasol has been trying to develop its retail footprint in South Africa to get a higher margin for its fuel," Sanlam Private Wealth equity analyst Shiraaz Abdullah said.
He said due to limited retail outlets, Sasol has been forced to sell its fuel at a lower wholesale price to competitors rather than directly to consumers.
"It all comes down to a decent price," he said.
South Africa's Energy Department said on Thursday it would investigate a bid by state-owned Strategic Fuel Fund to buy Chevron's assets without seeking clearance.
(Reporting by Zandi Shabalala)
