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Business Last Updated: Feb 6, 2020 - 1:28:51 PM

Tagwirei loses Sakunda to Trafigura in hostile takeover
By Herald, 05 Feb 2020
Feb 6, 2020 - 1:27:54 PM

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Trafigura Pte Limited has parted ways with its Zimbabwean partners Sakunda Holdings owned by businessman Mr Kuda Tagwirei. Trafigura Pte Limited now owns 100 percent of Trafigura Zimbabwe after acquiring Sakunda Holdings' 51 percent stake.

Trafigura Zimbabwe supplies fuel through Puma, Redan and Sakunda service stations and reportedly has interests in the Feruka Oil pipeline. However, the deal awaits regulatory approval. Further, Trafigura expects the transaction to improve clarity on the company's local operations.

Trafigura Pte, which is head-quartered in Switzerland, held a minority 49 percent stake in Trafigura Zimbabwe through Puma Energy, while Sakunda Petroleum had the controlling stake of 51 percent, in line with local content laws that applied at the time of the investment.

The Second Republic has since tweaked the local content laws to attract more investors under the policy, "Zimbabwe is Open for Business".

Trafigura Zimbabwe was only involved in petroleum supply and distribution. The joint venture company was renamed from Sakunda Supplies to Trafigura Zimbabwe to differentiate the joint activities of marketing fuel, from those of the wider Sakunda Group of companies.

Mr Tagwirei's mobile phone went unanswered last night and had not responded to a text message by the time of going to print. However, a Trafigura Pte Ltd spokesperson yesterday confirmed Trafigura, Tagwirei part ways the transaction.

"In December 2019, Trafigura Pte Ltd signed an agreement to become the 100 percent owner of fuel supply business Trafigura Zimbabwe. This follows the purchase of Sakunda Holding's 51 percent stake in the company which is currently awaiting final regulatory approval," said the spokesperson.

"This will bring improved clarity on Trafigura's activities in the country, an opportunity for more robust financing of Trafigura Zimbabwe and aims to help improve the security of supply of fuel to Zimbabwe. Trafigura Zimbabwe will continue to ensure that petroleum products are made available in line with ZERA (the Zimbabwe Energy Regulatory Authority)'s regulated price build-up and quality standards.

"USD liquidity remains tight, contributing to a challenging business environment for suppliers and consumers. Nevertheless, Trafigura is committed to continuing to work closely with the Reserve Bank of Zimbabwe to provide credit and flexibility, notwithstanding its limited commercial role in the country."

The Trafigura spokesperson assured interested parties in Zimbabwe that the ownership change will not "cause any interruption to Trafigura's supply of fuel to Zimbabwe".

ZERA acting chief executive officer Mr Eddington Mazambani could neither confirm nor deny the transaction.

"Trafigura is not a licensee so ZERA wouldn't have their shareholding structure. Trafigura or Sakunda are best placed to comment," he said.

He referred further questions to the Competition and Tariff Commission (CTC) which handles mergers and de-mergers to check on potential monopolies that could arise. CTC director Ms Ellen Ruparanganda asked for written questions and had not responded by the time of going to print.

Secretary for Energy and Power Development Dr Gloria Magombo said she was not aware of the transaction.

Source:Ocnus.net 2020

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