Sasfin media statement
Trade union Solidarity has published two statements recently with regard to proceedings between Sasfin and Evraz Highveld Steel and Vanadium Limited (Highveld). These statements are factually incorrect and do not reflect an objective understanding of proceedings between Highveld and Sasfin.
Read also: Solidarity: Sasfin must repay R35m ‘blood money’ to Highveld Steel

Solidarity has not approached Sasfin directly with any of the concerns they have raised on media platforms.
In response to these statements, Sasfin would like to make the following clear:
- Sasfin Holdings Limited and Evraz Highveld Steel and Vanadium Limited (Highveld) last week announced that the dispute between Highveld against Sasfin – in respect of the break fee that Sasfin charged in terms of its discounting agreement – has been resolved.
- Evraz’s Business Rescue Practitioner confirmed that Highveld’s financial difficulties cannot in any way be blamed on the facilities extended by Sasfin to Evraz or Sasfin conduct.
In response to other claims made by Solidarity, Sasfin would like to make the following clear:
- Sasfin negotiated the facility with the Russian-appointed board, and we contracted all the terms and conditions including the break fee in terms of standard banking practice.
- Part of the reason for a break fee is that as a bank, we have to hold meaningful capital against our risk-weighted assets. Due to the opportunity cost associated with the deployment of capital, we needed to be protected against the opportunity costs incurred in reserving sufficient capital to maintain this facility and justify our cost of capital.
- We negotiated this facility with the company at a time when the large banks were not prepared to grant them a facility. Without this, the company would not have been able to continue for as long as it did. The funding we provided allowed Highveld to continue to operate for longer than would otherwise have been the case thereby ensuring that jobs were retained for at least a period.
- When the company went into Business Rescue (BR), the facility was terminated. We consequently met with the BR practitioner and offered to negotiate a reduced fee but our offer was initially rejected.
- The BR practitioner has now agreed to the amount of R20m (not R35 million as Solidarity reports) and we have refunded the balance plus interest, which altogether amounts to about half the amount we initially claimed. THE BR Practitioners have withdrawn their litigation.
- Break fees are very commonly charged by banks and a R20m break fee on a facility of R175m with provision for it to be increased to R300 million is certainly not excessive and had no impact on the sustainability of Highveld.
- Sasfin rejects any assertion that its break fee was associated with the rejection of an offer which it made to acquire a share in the company. That proposal was made to the shareholders in a final attempt to restructure the debt as part of a larger equity arrangement, which at the time we believed, would have given the business some chance of surviving. This, however, was rejected by the shareholders and Sasfin did not proceed. As the business is now going into liquidation it is clear that no other party was able to resurrect this company.
- The break fee that we have charged should not affect the amount set aside in the estate to pay the preferential claims of the workers.
Sasfin acts, at all times, both ethically and legally and the claims that Solidarity is making are ill informed.