Cash in on Sasol scheme

Abdul Milazi

Abdul Milazi

Sasol's R28 billion BEE share scheme - to be launched on Thursday - could be a blessing for those who have cash and a curse to those who don't.

Sasol is offering blacks, including its employees, 63 million shares or 10percent of the company's total share capital, in the country's single largest BEE deal to date.

According to the company circular from its recent shareholder meeting, black members of the public who do not have money to buy the stipulated minimum of 10 shares at R360 a share, can pay a minimum of R457,50 for 25 Sasol Inzalo shares, but would be locked in for 10 years.

These shares will be funded by Sasol and a number of local banks. Like all financed purchases, it would be like buying shares on loan.

According to Johan Koorts, an associate at specialist BEE deal makers, Bravura Equity Services, those who opted for the funded shares may find themselves losers in the end should the share value drop.

"When the oil price comes down, Sasol's share price will drop, but the value of the shareholders' debt will not. They will find themselves owing more than what the shares are worth," said Koorts.

He said the discounted price at 10percent of the March 23 trading price of R410 would work well for those who could afford to buy them outright.

He said those intending to buy for cash had already made a 38percent profit before they even bought the shares, as the Sasol share price closed at a record high of R514 a share on Thursday, driven by a rising crude oil price and the rand weakening in the face of attacks on foreigners.