Sasol announced on Tuesday that it had agreed to sell its 50% interest in its US-based Gemini high-density polyethylene joint venture to its partner INEOS for US$404 million (R6.2 billion at current exchange rates).
Sasol President and Chief Executive Officer Fleetwood Grobler said in a statement that the sale continued Sasol’s move toward focussing on specialty chemicals markets.
“We are pleased that our valued partner INEOS is acquiring Sasol’s share of the Gemini HDPE JV and appreciate our productive partnership over the past six years,” he said.
Michael Nagle, CEO of INEOS O&P USA, described Gemini as a "world-class asset" in a separate note, saying it was well-positioned to help the group meet increased demand from our customers.
Proceeds from the transaction will be used to repay Sasol's near-term debt obligations. The Johannesburg-headquartered petrochemical company has previously said that it is looking to sell assets to pay off debt and sharpen its strategic focus. As Fin24 reported in August, it ended a turbulent year with a loss of R91.3 billion.
The Gemini transaction is targeted to close by the end of 2020. Once completed, it will consolidate 100 percent of Gemini ownership and all marketing under INEOS, said Sasol.
In mid-November, meanwhile, Sasol announced that its long-delayed Lake Charles Chemicals Project in the US was fully operational.