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· The recently announced joint venture between Sasol and LyondellBasell in the Lake Charles Chemicals project will give the former much needed relief to stabilize its constrained balance sheet and reduce debt. Both entities have equal (50:50) participation in the joint venture
· The US$2-billion partnership with the multinational chemicals firm was unveiled only last Friday. Sasol announced months before that it was looking for a partner in the project which has been hit by cost overruns. The company also faced a temporary shutdown due to the impact of Hurricane Laura in August
The recently announced joint venture between Sasol and LyondellBasell in the Lake Charles Chemicals project will give the former much needed relief to stabilize its constrained balance sheet and reduce debt. Both entities have equal (50:50) participation in the joint venture.
The US$2-billion partnership with the multinational chemicals firm was unveiled only last Friday. Sasol announced months before that it was looking for a partner in the project which has been hit by cost overruns. The company also faced a temporary shutdown due to the impact of Hurricane Laura in August.
The transaction is expected to be finalized by the end of year, according to sources close to Sasol and the company does not foresee any hiccup. Shareholders will meet on 22 November for voting to approve the joint venture and other businesses.
The transaction is a critical part of Sasol’s response plan to reduce net debt. Following the formation of the joint venture, net debt before lease liabilities is expected to reduce from approximately US $10 billion to approximately US$8 billion. The Lake Charles transactions will generate liquidity to bring down the net debt of Sasol by close to US$3 billion.
Sasol will continue to retain ownership and operatorship of the US Performance Chemicals Business. It will also have control over the remainder of the vacant land on Lake Charles complex. The base chemicals manufactured at the plant include ethylene and polyethylene products.
