African investment company Sakhumnotho Group Holdings has bought an initial 26% stake in the Refinex and South African Tank Terminals (SATT) holding company.
Refinex, founded as Energy Oil Oleochemicals in 1983, is one of the largest privately own petrochemicals companies in southern Africa. It offers bulk fuel oil supplies and together with SATT offers processing, manufacturing, blending, transport and storage of petrochemicals. SATT’s terminal in Roodekop Germiston has a capacity of 12 million L, with storage available for both Refinex and external customers. Product is currently moved in and out of the terminal by road tanker, but with a rail siding also onsite there is the potential to also distribute products by rail.
Sakhumnotho says that the acquisition is a precursor to acquiring a larger stake in the holdings company. The investment firm has existing experience in the oil and gas sector, having already invested in Total Southern Africa. Combining this expertise with that of Refinex and SATT in processing petrochemical streams will allow the companies together to consolidate the entire petrochemical value chain, from supply to customer.
As well as refining virgin oil, Refinex also sources waste oil to produce furnace fuels and solvents, recycling the resources and preventing them from being dumped and potentially polluting the environment. Refinex says that by enabling growth and expansion, through new investment, that it will be able to have a greater positive impact on the environment.
As Sakhumnotho is wholly black-owned, the deal also provides Refinex and SATT with Black Economic Empowerment (BEE) credits, under the government scheme set up in South Africa to address the inequalities of Apartheid and support black businesses. A good score improves the change of obtaining government contracts.
‘This deal further deepens our involvement in the oil and gas sector and allows us to play a greater part in the industry’s future. There are real synergies of business, purpose, as well as spirit between the two companies and we look forward to growing together as we map the journey ahead and create value for all involved,’ says Sipho Mseleku, president and CEO of Sakhumnotho Group.