SHELL South Africa and THEBE INVESTMENT CORPORATION announce merger of Multimillion rand Downstream entities
Jan 19, 2015
Shell South Africa and Thebe Investment Corporation are pleased to announce that they have signed definite agreements that would culminate in the merger of the Shell South Africa Marketing and Shell South Africa Refining businesses to form Shell Downstream South Africa.
The agreements further provides for the following:
- Thebe to acquire additional equity to bring its shareholding to 28% in the merged entity;
- All acquisition debt to be settled to ensure un-encumbrance of the new structure;
- The creation of an integrated relationship to capture various opportunities in the oil and gas sector.
Bonang Mohale, Shell South Africa, Country Chairman said, “The newly formed Shell Downstream South Africa business creates a robust corporate platform to operate, invest and grow shareholder value along the whole value chain by bringing together refining and marketing into one business. The combined business will have a stronger balance sheet from day one which will enable future investment and growth of the business.”
“The partnership between the companies is over twelve years and we have enjoyed a mutually beneficial partnership with Thebe so I am extremely pleased about maintaining and developing this longstanding relationship for the next phase of Shell’s downstream growth and transformation in South Africa,” added Mohale.
Vusi Khanyile, Chairman, Thebe Investment Corporation said, “We have enjoyed an extensive and productive relationship with Shell. This new phase builds on that relationship and helps us cement our long–term commitment in the energy sector. In the 23 years of Thebe’s existence; our brand continues, through such investments, to touch the lives of many communities and make a meaningful contribution towards transformation in this sector”.
Shell customers will continue to be supplied by Shell Downstream South Africa with the same quality products and services as they are currently. The creation of the merged entity will not have any impact on staff, contractors or suppliers.
“There have been a number of developments in the Energy sector both regionally and internationally. These developments provide Thebe with opportunities to further entrench our participation in this sector and seek growth in sub-sectors within this space,” said Vusi Khanyile.
With a 113-year history in South Africa, Shell has engaged in empowerment initiatives as far back as 1996. Through a concerted transformation programme, Shell became the first international oil company operating in South Africa to achieve Level 3 Broad Based Black Economic Empowerment(BBBEE) contributor status in 2010. This was further improved in 2012 when Shell attained Level 2 contributor status.
“We remain committed to South Africa and to align with the spirit of meaningful BBBEE, not only as a premier energy company, but also, as a committed corporate citizen and change agent. To date, we have made great strides towards achieving our own transformation milestones as well as aligning and surpassing legal requirements in this area of our business. The newly created merged company and our continued partnership with Thebe will allow us to further strengthen our leadership position in the transformation space locally,” concludes Mohale.
|Sen Mdhluli||Thebe Investment Corporation||011 447-7800
+27 83 584 9013
|Daisy Mohlomi||Thebe Investment Corporation||011 447-7800
+27 84 777 8606
|Dineo Pooe||Shell SA||+27 83 629 0447||dineo.Pooe@shell.com|
Notes to editors
Shell and Thebe Background
- Shell originally embarked on a refinery processing deal in 1998 with Tepco, an energy company owned and established by Thebe Investment Corporation. This was followed by joint ventures with Tepco in 2001 in aviation and commercial fuels.
- In 2000, an assessment of potential BEE partners was made and Thebe was selected from a shortlist of candidates.
- In 2002, Thebe acquired a 25 percent interest in Shell’s downstream sales and marketing business held by Shell South Africa Marketing (Pty) Ltd.
- In 2008, Thebe’s equity participation was extended to Shell’s entire value chain when it acquired 25 percent of Shell South Africa Refining (Pty) Ltd, which owns Shell’s refining interests in the country.
In December 2011 Shell sold a further three percent of its marketing business to Thebe – increasing its stake to 28 percent
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