Shell Nears Sale of South African Assets After Valuation Dispute Resolution
London-based Shell Plc and its South African partner Thebe Investment Corp. are reportedly close to resolving a valuation dispute, paving the way for the sale of Shell's local downstream assets for up to $1 billion.
Shell operates a network of 600 service stations across South Africa, with Thebe holding a 28% stake in its retail operation. The dispute emerged in 2022 when Thebe sought to exit its investment, leading to disagreements over the value of its stake.
According to sources familiar with the matter, the parties are now nearing an agreement to end the impasse. Shell declined to comment, while Thebe was unavailable for response.
A potential deal could fetch Thebe more than the initial $200 million valuation it placed on its stake in 2022, the sources said. At the time, Shell estimated its worth was lower.
The resolution of the dispute provides potential buyers with certainty about the deal's size as they prepare to submit binding offers in the coming weeks. The assets have attracted interest from companies including Saudi Aramco, Abu Dhabi National Oil Co., and Trafigura.
In addition to Shell's downstream assets, Petroliam Nasional Bhd. recently sold its 74% stake in Engen Ltd., South Africa's largest gas-station chain, to a unit of trading house Vitol Group.