AFTER looking for a suitable partner for two and a half years, it was a casual meeting at the Port Elizabeth Airport which sparked a R15-million fuel deal.
Nelson Mandela Bay businessman Stephen Dondolo, chief executive of African Pioneer, yesterday celebrated the 22% share his company now owns in Caltex Eastern Cape Marketer.
A part of the R15-million fuel deal, which took more than a year to broker, is that Dondolo has the option to increase his shares to 50% within the next four years.
Caltex EC Marketer chief executive Clive Berlyn said he spent a frustrating two-and-a- half years looking for a suitable black economic empowerment partner after his partner, Richard Ndungane, died in 2010. In this time he acquired an additional 41 petrol stations in the western half of the province, bringing the total fuel stations of Caltex EC Marketer to 92, stretching from Kokstad to Plettenberg Bay.
The R120-million transaction for the 41 additional petrol stations was funded by First National Bank in 2012, but Berlyn also had discussions with Investec’s investment growth and acquisitions manager Edgar Quinton before deciding on FNB to finance the deal.
“A while after that, we ran into each other again at the PE Airport and it was Quinton who suggested Dondolo may make a good partner,” Berlyn said.
The ball started rolling on one of the biggest fuel deals in the province, and after three due diligence studies and many discussions, negotiations and consultations the transaction was made public yesterday.
“We found a good match in him to add value to the company.”
Caltex EC Marketer was the first in the country to be branded in this way in 2005. Otherwise known as a master franchiser, the Eastern Cape is part of 11 other Caltex branded marketers across the country. It is now the largest branded marketer in the country as well as the largest distributor in Chevron’s Africa/ Middle East/ Pakistan (AMEP) region.
“We have come a long way from working from outbuildings in Mthatha. We are expanding our East London building and breaking ground for a new office building in Cape Road. We plan to continue to grow, and our arena will remain the Eastern Cape. We spend about 90% of our money in the province,” Berlyn said.
Dondolo said his investment company, African Pioneer, shared similar humble beginnings in Uitenhage and was equally committed to economic growth in the province.
African Pioneer is already invested in some of the top multinational Eastern Cape-based companies in the region, including Pioneer Fishing, Woodlands Dairy, Coca-Cola Fortune and Cerebos.
Dondolo said what motivated him to invest in Caltex EC Marketer was that the company was driven by family values and had strong management systems in place.
“The province is full of opportunities. We would like to grow our company’s involvement in energy-related businesses because that is where the future employment lies.”