BEE Partner, South Africa Economy Watch

Yesterday (21st of October) Vuyo Jack statement on Business Report showed him unhappy about the mining industry’s action to BEE. Based on Vuyo Jack’s statement, government made a move to force mining firms to sell their asstes to black investors. Actually the charter required mining firms to sell at least 26 percent of their assets to black investors by 2014. Government was not happy for everybody wait until the deadline. So the smart choice was to force ming firms to do something. Of course, they don’t want to immediately to scare away the foreign investors. They chose to give pressure on SA mining industry first.

Sasol petrochemical group sold 20 percent of its Sasol Mining share to Ixia Coal in a deal worth R1.9 billion. Sasol petrochemical group total market value worth R212 billion. The total transaction cost is R9.3 billion which only accounts for 4 percentage of total value. It means Sasol makes 16% discount of its share price. The question is does the sasol loose its money, or does the Ixia Coal make a profit? In other way, whose money has been sacrificed during the deal? By BEEPartner.com editor opinion, If sasol share price going to a downturn, their both loose.