The South African petrochemical and energy giant Sasol is on a fast track towards cutting its debt by disposing some of its valuable assets. Sasol announced on Wednesday that it has entered into a massive 8.5 billion-Rand (USD 515 million) deal with the Paris-based Air Liquide.
As per the deal, the South African giant is likely to sell its 16 air-separation units that were being used earlier to serve Sasol’s plants in Secunda (located east of Johannesburg). With this, the French company would acquire the biggest Oxygen production site in the world which it envisions to modernize in the coming years through exhaustive planning. Air Liquide believes that this acquisition and operation handling of all the oxygen production units of the Sasol Secunda site would reinforce more than 40 years relationship between the two. Through this strategic move, Sasol is planning to raise as much as USD 5 billion which would help it to reduce its debt by more than a half.
The sale of air separation units would also bring it closer to its goal of cutting GHG emissions by at least 10% by 2030 as it currently stands as the nation’s second-biggest emitter of greenhouse gases. After the announcement, Sasol’s shares rose as much as 11.6% and was traded 10.3% higher at R 147.81 by 1:39 p.m. in Johannesburg. This was the company’s highest one-day gain since 8th June. Other major asset sales of the company include stakes in its U.S. chemicals project and interest in a power plant and gas pipeline in Mozambique.