Orkney mine faces liquidation
The Orkney gold mine once owned by the former president’s nephew Khulubuse Zuma and his partners at the notorious Aurora Empowerment Systems is facing liquidation yet again. The move to close down China African Precious Metals (CAPM), which bought the Orkney assets in 2011, comes from its empowerment partner, BEK Holdings.
BEK claims the majority shareholder, China-based Golden Haven, has for years deliberately starved the company of capital in order to hijack it.
The impasse between the shareholders peaked this year when BEK director Elias Khumalo, who is seen as close to former president Jacob Zuma, was demoted and stripped of decision-making powers.
Although operational, the mine owes an environmental liability of R123m to the department of mineral resources and so is insolvent and on the verge of having its licence revoked, according to BEK.
Manchadi Kekana, CAPM’s lawyer, said the application is without merit and “an abuse of the court process geared to destabilise the operations”.
The allegations will be dealt with in CAPM’s answering affidavit.
Orkney gold mine was sold off with other assets when Pamodzi Gold went into liquidation in 2009.
It was bought by Aurora, a company with Khulubuse Zuma and Nelson Mandela’s grandson Zondwa Mandela among its directors. But operations fell into disrepair when funding from a Malaysian equity fund did not materialise.
In 2011, Pamodzi Gold Orkney was bought by CAPM — a partnership between BEK Holdings and China-based Superb Gold. Superb Gold’s 74% of CAPM was sold on to related parties and ultimately transferred to Golden Haven in 2013.
Khumalo’s affidavit details how relations soured after years of struggling to get Golden Haven to fulfil its capital commitments, even though funds were raised by listing CAPM on the Shanghai Stock Exchange.
Khumalo said his repeated requests to be allowed to approach SA’s Industrial Development Corporation (IDC) for funding were refused by Golden Haven.
He also offered that BEK either buy over the majority stake or sell off its own to Golden Haven, to no avail.
In September, Khumalo said he was demoted to a nonexecutive director and claimed that new directors were appointed to the CAPM board in an irregular manner.
Now, coinciding with the liquidation process, there is an opportunity for Golden Haven to sell its stake to another buyer, according to BEK’s lawyer, Barnabas Xulu.
Although he would not say who the buyers were, its bankers have confirmed the availability of funds.