Grindrod to exit marine fuel trading business
JSE-listed freight and logistics company Grindrod has started the process to exit its 50% investment in the marine fuel trading business Cockett Group, comprising CMOG Fuel DMCC and Cockett Marine South Africa.
Grindrod, through its wholly owned subsidiaries, and energy and commodities company Vitol, which owns the other 50% of Cockett, have agreed to proceed with a solvent wind down of Cockett.
This followed the execution of a framework agreement entered into between the Cockett shareholders, which became fully effective on May 8.
In terms of this framework agreement, Grindrod received $22-million on May 8, which is 61% of the carrying value of the investment as of December 31, 2024.
Vitol and Grindrod made the strategic decision to conduct an orderly wind down of Cockett. This difficult decision was reached after long consideration and in light of the noncore nature of Cockett’s business to both shareholders, they said.
Cockett was the only material asset remaining in Grindrod’s noncore asset portfolio, Grindrod said.
Cockett is in a sound financial position. It will continue to perform all of its existing contractual obligations in a timely manner to suppliers and customers. However, it will not enter into any new business.
The shareholders thanked the Cockett employees for their professionalism, hard work and dedication to the company over many years. All employees will receive considered and responsible compensation.
The shareholders also thanked all of Cockett’s suppliers and customers for their support over the past 45 years of trading, the two companies said in a joint statement on May 6.
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