Petronas in Talks to Sell South Africa’s Biggest Fuel Retailer
“Petronas is currently in preliminary discussion with interested parties and we are not able to comment further on this matter,” Azman Ibrahim, a Kuala Lumpur-based Petronas spokesman said in an e-mailed response to queries by Bloomberg News today. He didn’t name potential buyers.
PetroSA, South Africa’s state-owned oil company, is considering buying a stake, according to two people with knowledge of an announcement made on July 15 to Engen staff by Ahmad Nizam Salleh, the unit’s chief executive officer. Petronas, as the Malaysian company is known, holds 80 percent of Cape Town-based Engen and Pembani Group Ltd. owns the rest.
By taking control of Engen, PetroSA would be able to sell directly to consumers, gaining access to customers in more than 20 African countries. It mostly sells fuel in Africa through 1,500 filling stations.
It would also add refining capacity. Engen has a 135,000-barrel-a-day refinery and a lubricating-oils blending plant in the eastern South African city of Durban, according to the company’s website. The facility, which opened in 1954, suffered a strike over pay and a fire in 2011.
PetroSA operates a 45,000-barrel-a-day gas-to-fuel refinery at Mossel Bay on South Africa’s southwest coast and plans a new crude-oil refinery near Port Elizabeth in the Eastern Cape province. The Cape Town-based company doesn’t own any retail operations, Thabo Mabaso, a spokesman, said by phone yesterday.
Petronas bought Engen in 1998 before later selling a minority stake to Pembani, a private-equity firm based in Johannesburg. PetroSA is willing to look for downstream opportunities and has been negotiating with potential partners, the company said in a statement to Bloomberg News on July 16, without elaborating.
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