Sasol Amends Plan to Issue Additional Shares to Settle Expected Outstanding Sasol Inzalo Debt

JOHANNESBURG, October 9, 2017 /PRNewswire/ --

Sasol shareholders are referred to the Company's announcement on 20 September 2017 (the "First Announcement") regarding Sasol's broad-based black economic empowerment ownership transaction, incorporating information relating to the termination of the Sasol Inzalo black economic empowerment transaction ("Sasol Inzalo transaction").

The Sasol Inzalo transaction was a landmark, broad-based black economic empowerment initiative that received shareholder approval in 2008. A significant amount of the funding to facilitate this transaction was obtained through the issue of preference shares to external banks to facilitate the acquisition of Sasol preferred ordinary shares by Sasol Inzalo Groups Funding (Pty) Ltd and Sasol Inzalo Public Funding (Pty) Ltd (collectively "the Inzalo FundCos").

Under the terms approved in 2008, 25 547 081 Sasol preferred ordinary shares are due to be re-designated to Sasol ordinary shares during June and September 2018. This would result in dilution for existing ordinary shareholders of approximately 4%. These shares would then need to be sold in the market by the Inzalo FundCos in order to fund the redemption of the preference shares and cumulative dividends. Based on the recent trading range of Sasol's share price, however, this would not be sufficient to satisfy these obligations and creates a funding shortfall of between R2 billion and R3 billion. This shortfall will be made good by Sasol in terms of a guarantee granted in respect of a portion of the preference share funding at the outset of the transaction.

In the First Announcement Sasol indicated that its preferred funding option would be to undertake an accelerated book-build of up to 43 million Sasol ordinary shares to enable the funding of the minimum amount sufficient to repurchase the relevant Sasol preferred ordinary shares and settle the relevant obligations and associated costs of the Inzalo FundCos. The rationale for this option was to achieve rapid resolution of Sasol and the Inzalo FundCos' respective financing obligations with a structure designed to help protect Sasol's investment grade credit rating with limited incremental dilution for shareholders of approximately 1% incremental dilution pursuant to the issue by Sasol of new ordinary shares.   

Following extensive engagement with shareholders, Sasol is now undertaking to explore, in consultation with the external banks and Inzalo FundCos, different funding options to settle the relevant financing obligations. Sasol will therefore no longer pursue the preferred funding option, as described in the First Announcement, of issuing up to 43 million ordinary shares through an accelerated book-build process. Sasol's intention is to mitigate the amount of shareholder dilution whilst still maintaining Sasol's investment grade credit rating. Sasol will communicate its final plan for settling the Inzalo FundCos' debt in February 2018.

The terms of Sasol Khanyisa relating to Sasol Inzalo participants, SOLBE1 shareholders and qualifying employees as set out the First Announcement are in no way affected by this announcement.

Sponsor: Deutsche Securities (SA) Proprietary Limited

Investor relations:
Cavan Hill, Senior Vice President: Investor Relations
Telephone: +27(0)10-344-9280

Alex Anderson, Head of Group Media Relations
Direct telephone: +27(0)10-344-6509; Mobile: +27(0)71-600-9605;
alex.anderson@sasol.com

Matebello Motloung, Senior Specialist: Media Relations
Direct telephone: +27(0)11-344-9256, Mobile: +27(0)83-773-9457
matebello.motloung@sasol.com

SOURCE Sasol Limited