Sasol is set to strengthen its global position by listing on the New York Stock Exchange on Wednesday.
Peter Cox, chief executive officer of South African Coal, Oil and Gas Corporation, said the decision to replace its existing position on the Nasdaq was integral to its globalisation strategy.
”Growing investor interest in Sasol, especially from North America, made us realise that the NYSE was the most appropriate exchange for the listing of our ADRs (American Depository Receipts).”
He said the company was able to take this step as its earnings profile now reflected the international spread of its revenue and earnings base.
”In the 2002 financial year, around 60% of our earnings were derived from outside South Africa,” Cox said.
Sasol executive director Trevor Munday said the listing would give investors greater understanding of the company.
”The NYSE is an attractive option due to the larger pool of investment it attracts, and US investors prefer their own exchanges to foreign bourses such as the JSE.”
He said the timing of the listing was not driven by the need to raise capital.
”We believe that the listing will attract a new group of investors and significantly more marginal buyers and sellers, which will enhance demand and hopefully therefore also the price.
David Brennan, Standard Corporation Merchant Bank (SCMB) analyst said the company was squaring itself up to the New York market.
”The listing will give them greater credibility. They should have done this two years ago.”
Sasol’s share price fell to R82 on Monday on news that its subcontractor Fluor was being sued by apartheid victims.
Brennan attributed the fall to Sasol going ex-dividend on Monday.
Sasol is South Africa’s largest producer of synthetic fuels and chemical products.
The company, established in 1950, was listed on the Johannesburg stock exchange in 1979 and on NASDAQ in New York in 1982. It has a total of 15018 shareholders.
Sasol’s market capitalisation amounts to R25-billion. – Sapa