Published: 13 November 2013

LOCAL fuel retailer Redan Petroleum plans to sell 60 percent stake to Puma Energy, but the deal might face regulatory hurdles as the proposed shareholding structure would exceed the foreign shareholding threshold provided for in the country's indigenisation laws.

Puma Energy, with operations in 33 countries, including neighbouring Zambia and Botswana, is a joint venture between Trafigura, one of the world's commodities trading companies and Sanagol, an Angolan state-owned firm on a 55-45 percent shareholding basis.

If the transaction sails through, Puma Energy would pay between $20-$24 million for the shareholding, according to an independent evaluation done by a local advisory firm.

Redan, suffering interrupted fuel supplies due to funding constraints, requires at least $20 million "but it is always a moving target", Mr Chikumbu said.

The company, then co-owned by Mr Chigumbu and Mr Nigel Earle, started fuel imports in 2004.

Mr Earle sold his 50 percent shareholding to Mr Chigumbu in 2010 for $8 million.

Since then, Redan has been pursuing various recapitalisation avenues including listing on the Zimbabwe Stock Exchange. Investec of South Africa and Chinese oil company Sinopec also made offers for significant shareholding in the company.

Redan sells an average 18 million litres of fuel per month and employs 600 workers.

It operates 67 service stations countrywide, most of them franchises while the group owns 17.
- herald

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