South Africa’s competition watchdog approved Glencore’s (GLEN.L) roughly $900 million bid for Chevron’s (CVX.N) local and Botswana assets on Thursday, bolstering its chances of scuppering a rival bid from China’s Sinopec (000554.SZ).
Chevron agreed last year to sell its stake to state-owned Sinopec before miner and commodities trader Glencore swooped in after reaching a deal with minority shareholders, who backed it and exercised preemptive rights on the sale.
At stake is a 75 percent share in Chevron’s South African subsidiary that runs a 100,000-barrels-per-day oil refinery in Cape Town, a lubricants plant in Durban and 820 petrol stations and other oil storage facilities.
The sale also includes 220 convenience stores across South Africa and Botswana.
For Glencore, the deal would secure the trader’s first refining asset since it ventured into downstream investments. For Sinopec, it would mark its second major refinery investment as the company looks to expand overseas amid a saturated home market.
Both deals have now been given the green light from the Competition Commission subject to several conditions that include the preservation of jobs after the deal.
It is now up to the Competition Tribunal, which makes the final ruling on deals, to decide whether to accept the Commission’s recommendations. The Tribunal has already approved Sinopec’s bid.
Source: Reuters.com