JSE-listed petrochemicals giant Sasol has entered into an agreement to sell its sodium cyanide business, in Sasolburg, to Czech Republic-based chemicals company Draslovka Holding Company for R1.46-billion.
Draslovka is a global producer of cyanide-based chemical specialties and agricultural chemicals, with more than 100 years’ operating experience. It has facilities in the Czech Republic, South Africa, Australia, New Zealand and India.
The company’s existing South African operations involve Draslovka Services operating as a licensed soil fumigation company, based in Stellenbosch.
The company has stated its intention to invest about $50-million in the Sasol facility to increase production and improve efficiency, with the long-term goal of serving both the South African mining industry and growing African export demand.
This will be Draslovka’s first major investment into the African continent and forms part of its international expansion plans.
Moreover, Draslovka has partnered with black-women-owned Navuka Investment Holdings as its broad-based black economic empowerment partner, which will own 25% of the South African operation.
In turn, Navuka CEO Nathiera Kimber says this partnership will allow the company to play a more meaningful role in South Africa’s chemical and mining industries.
Subject to regulatory approvals, the deal should be completed in the first half of next year
Meanwhile, Sasol CEO Fleetwood Grobler says the company has made progress in its expedited review of the business to consider how it can position itself to be sustainable in a low oil price environment. Consistent with this approach has been an expanded asset disposal process.
Sasol will still supply key feedstocks, utilities and site services to Draslovka on an arm’s length basis.
Grobler points out that Sasol intends to explore the potential for business development opportunities by Draslovka which could result in further synergies at the site.