Cape Town - An empowerment consortium has acquired a 25 percent shareholding in Caltex Oil SA in a deal estimated to be worth more than R4 billion in annual sales.
Led by African Legend Investment, which is headed by Mashudu Ramano, the latest empowerment deal sets out to comply with the 10-year equity target of the petroleum industry's empowerment charter.
It is not only the biggest deal announced so far, but could also claim to be the most inclusive, as it entails the empowerment partner taking a quarter stake in all of Caltex SA's operations, from its refinery to its lubricant and retail businesses.
African Legend holds a 15 percent stake in Caltex SA; women's empowerment group Lithemba Investment, of which 70 percent of members own petrol service stations, holds 5 percent; the SA National Taxi Council, representing over 80 000 taxi owners and 120 000 drivers, will hold 3 percent; while newly created Caltex Employee Participation Plan will own 2 percent.
Ditikeni Investment Company has a 1 percent stake within the employee participation shareholding. The shareholding was bought from Caltex SA's parent, the global energy group ChevronTexaco.
Dana Flanders, the chairman of Caltex SA, said yesterday the deal would be paid for out of the empowerment partners' 25 percent share of the dividends over a targeted period of 10 years. Detailed terms of the agreement remained confidential but were based on performance.
A new Caltex SA board still had to be announced, but the consortium would have a minimum representation of two of the eight directors.
Other features of the deal involved active participation in board subcommittees, such as for the audit, strategy, business planning and human resources functions.
In addition, shareholder consultative committees would be formed to get involved in management-line functions such as marketing and new business development, corporate and government affairs.
Flanders said Caltex had a track-record of successful partnerships and joint ventures through ChevronTexaco. The intention was to build a new South African company which levered off ChevronTexaco's global business model and local talent.
Ramano said this was African Legend's biggest investment so far and represented another of its thrusts into the energy sector, which included a stake in Mozambican gas company Elgas.
African Legend also owned an information technology company and was part of the national empowerment consortium that controlled Johnnic. Over 50 groups had attempted the equity deal with Caltex.
Ramano said: "This transaction does not involve hiving-off Caltex marketing activities into a separate entity, which then does a transaction with a black business group.
"The consortium will participate in the decision making processes of the board and will also be involved in various operational committees, initially in an advisory capacity.
"Certain individual members of the consortium will be involved on a daily basis in the activities and affairs of Caltex."
African Legends' own shareholders comprise 34 groups, which include business, organised labour, women's groups, entrepreneurs, professionals and community organisations.