Sasol sells Tosas to Raubex
Listed road construction and rehabilitation group Raubex has bought Tosas‚ a manufacturer of bituminous products‚ from Sasol Oil for R120m in cash.
The sale provides Raubex with several bitumen processing and storage facilities in inland regions of SA and a significant footprint in both Namibia and Botswana.
It also provides Raubex with traditional as well as "modified" bitumen operations. Crucially‚ this gives the company security of supply in an uncertain South African bitumen market.
Tosas's products are mainly used in road construction. All regulatory approvals have been met.
"Following an assessment of the strategic fit of the downstream bitumen business‚ Sasol Oil decided to sell its interest in Tosas‚" Sasol group told I-Net Bridge/ BDlive on Monday (15 April).
Modified bitumen includes rubber or synthetic latex making it a more elastic and durable product with greater temperature stability. Roads are sensitive to extremes in temperature‚ cracking in cold conditions and softening at higher temperatures‚ causing surface deformation.
Raubex's chief executive Rudolf Fourie said the acquisition gave the group the ability to "modify" bitumen in-house‚ and also provided 50% of its bitumen needs.
"We want to make sure we provide the whole value-chain of road construction - that is our business‚" he said.
He said in the past Raubex had bought 50% of its bitumen from oil companies‚ and another 50% from suppliers of modified bitumen. These included Tosas and Colas SA‚ a maker of bituminous binders and slurries for road surfacing.
"The other main reason is because of the bitumen supply crisis in the country. It secures our supply‚" he said.
Persistent bitumen shortages have seen a rise in imports in recent years and Raubex had resorted to buying products from both Singapore and Spain.
Fourie said SA's major oil producers were turning away from bitumen production‚ mainly because of breakdowns in aging plant‚ and high maintenance costs.
Instead they were now focusing on making and distributing diesel‚ petrol and kerosene.
He said companies needed storage facilities for the product and that Raubex now owned these‚ including the ones used to store imported bitumen.
"We think‚ the acquisition represents a strong strategic fit for Raubex as an integrated road construction and rehabilitation company‚" Sibonginkosi Nyanga‚ an analyst at Imara SP Reid‚ said.
"To avoid the repeat of the chaos that followed the shortage of bitumen in 2011‚ this acquisition is a good move by Raubex‚" he said.
Source: I-Net Bridge
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