Chinese company gets tentative green light for Chevron SA deal

The Chinese state-owned oil company Sinopec has cleared a major regulatory hurdle for its US$900-million bid for Chevron SA after the Competition tribunal gave the green light on Friday, provided it meets two conditions.

The two new conditions aim to ensure Sinopec picks up some or all of the rebranding costs of the filling stations and does not change any contracts with the branded marketers to their detriment.

In addition, Sinopec has committed to investing R6bn in upgrading Chevron’s Cape Town refinery and a further R215m in a development fund to support small black-owned suppliers.

The company has also undertaken to set up its regional head office in SA and maintain local procurement and black-empowerment ownership.

Chevron’s empowerment bidders, backed by Glencore, have also bid on the deal and it is understood that the rival bidders would have to match all the conditions as well for their deal to get the green light.

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