Fuel retailer Engen denied allegations by black-owned oil companies in Zimbabwe that, in its efforts to buy BP and Shell assets in the country, it had flouted the country's empowerment legislation.

According to media reports, a group of Zimbabwe's locally owned oil companies intended to block Engen's plans to acquire Shell and BP assets there.

If they succeed in blocking the transaction, it will be a blow to Engen's foray into several southern African countries.

Engen has assets in a number of African countries, in line with its strategy to be one of the biggest energy companies in sub-Saharan Africa by 2016.

Zimbabwe's Herald newspaper reported that the Zimbabwean companies had sought legal advice in a bid to block plans by Engen and KenolKobil — formerly Kenya Oil Company — to buy Shell Zimbabwe and BP Zimbabwe, more than 75 service stations and bulk storage facilities.

The companies alleged that the transactions had been done without participation of locals.

Unlikely to get govt approval

"Of major concern to the local oil companies is the apparent disregard by the foreign investors to respect provisions of the Indigenisation and Economic Empowerment Act, which clearly spell out that the disposal of any concern should constitute 51 percent local component," the newspaper said.

It quoted an unnamed analyst who said the deal was not exclusive and was unlikely to get government approval.

Engen yesterday moved to defend itself. Spokesperson Tania Landsberg yesterday said the company had not flouted Zimbabwe's empowerment law. "Absolutely not. The indigenisation review process has not even begun yet. The purchase from Shell and BP does not involve any indigenous Zimbabwean shareholder, but the purchasers will actively engage with the various authorities as to how we will comply with the legislation."

She said the companies would empower Zimbabweans through franchising of service stations and transport contracts.

She said Engen normally conducted in-depth research and consulted with all interested parties "other than those that the sellers prohibit us from consulting prior to the conclusion of the transaction before we embark on any acquisition or joint venture".

Business Day

'Share Sexwale's wealth' Numsa says the immense wealth of Patrice Motsepe and Tokyo Sexwale must be nationalised.

Eskom's big fat lies Eskom called its application for a 45% electricity tariff hike a "smoothed" hike.

UCT is best in Africa The UCT Graduate School of Business was rated the Best Business School in Africa.