STAKE SALE
HILARY JOFFE: Glencore’s Chevron deal a triple twister
‘An intriguing piece of the puzzle is that Glencore doesn’t plan to keep the whole stake but wants to bring in another partner’
When the China Petroleum and Chemical Corporation (Sinopec) agreed in March to buy the 75% of Chevron’s South African business that the US parent had put up for sale, it was a significant moment for relations between SA and China. The $900m deal was the largest acquisition by a Chinese firm of a controlling stake in a South African business and was one of Sinopec’s largest global deals. Sinopec, a Fortune 500 firm and the world’s second-largest oil refiner, undertook to use its resources and experience in modernising oil infrastructure to upgrade Chevron’s Cape Town refinery, enabling it to meet new cleaner fuel standards. The deal seemed to be in line with China’s Belt and Road initiative to expand its global leadership by building infrastructure and trade links. SA is one of the countries that has signed up to support the initiative. Just last month, President Jacob Zuma and his Chinese counterpart, Xi Jinping, were cosying up on the sidelines of the Brics meeting in Shanghai.
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