Eskom ‘bought’ coal mine for the Gup­tas

CityPress - - News - JAN DE LANGE news@city­

Pem­bani, the in­flu­en­tial in­vest­ment com­pany that took over Deputy Pres­i­dent Cyril Ramaphosa’s busi­ness in­ter­ests, would have bought Op­ti­mum coal mine, but the ac­qui­si­tion was al­legedly blocked by for­mer Eskom chief ex­ec­u­tive of­fi­cer (CEO) Brian Molefe.

Ac­cord­ing to sources close to the trans­ac­tion, Pem­bani – now man­aged by re­spected en­tre­pre­neur Phuthuma Nh­leko – was “bet­ter qual­i­fied” than Gupta com­pany Tegeta to take over the mine be­cause of fund­ing avail­abil­ity. How­ever, the lat­ter even­tu­ally ac­quired Op­ti­mum af­ter the mine was forced into busi­ness res­cue by Brian Molefe, just six months af­ter be­com­ing Eskom CEO.

Tegeta is con­trolled by the Gup­tas and Duduzane Zuma, Pres­i­dent Ja­cob Zuma’s son.

Pem­bani merged with Ramaphosa’s in­vest­ment com­pany Shan­duka in May 2014. The trans­ac­tion brought into ex­is­tence a com­pany worth R13 bil­lion and put Ramaphosa in a po­si­tion where there would be no con­flicts of in­ter­est be­tween his busi­ness in­ter­ests and his po­si­tion as deputy pres­i­dent.

City Press’ sis­ter news­pa­per Rap­port re­ports that a source close to the trans­ac­tion said: “There were two re­quire­ments to buy Op­ti­mum: the buyer had to pro­vide proof that it had fi­nanc­ing for the pur­chase price and that it had a con­tract to pur­chase the 4 mil­lion tons of coal that Op­ti­mum pro­duces for the domestic mar­ket every year.

“Pem­bani had no prob­lem with ob­tain­ing the fi­nanc­ing, but couldn’t get a con­tract with Eskom. They only had one meet­ing with Eskom, but Molefe him­self told Pem­bani at the meet­ing held in De­cem­ber 2015 that Eskom would not con­clude a con­tract with them.”

This di­rectly con­tra­dicts Eskom’s po­si­tion on the mat­ter, which was that it had to con­clude hasty con­tracts with Tegeta be­cause it ur­gently had to en­sure the con­tin­ued sup­ply of coal from the mine.

Un­like Tegeta, Pem­bani is a proven player in the coal in­dus­try.

At that stage, Pem­bani al­ready owned 12% of Op­ti­mum as Glen­core’s black em­pow­er­ment part­ner and was also BHP Bil­li­ton’s em­pow­er­ment part­ner in var­i­ous large coal mines.

Op­ti­mum at the time owed Pem­bani R128 mil­lion in loans. The pur­chase price of R2.1 bil­lion for which Tegeta even­tu­ally bought the mine, how­ever, meant there was barely enough money to pay Op­ti­mum’s bank debt and Pem­bani ended up los­ing the money.

Kennedy “Kenny” Bun­gane, CEO of Pem­bani, did not want to com­ment on the mat­ter, but in­formed sources said the group “could not wait” for a ju­di­cial com­mis­sion of in­quiry into state cap­ture to be es­tab­lished so that this in­for­ma­tion could be re­ported.

The as­ton­ish­ing ad­mis­sion by Anoj Singh, chief fi­nan­cial of­fi­cer at Eskom, that Eskom pro­vided Absa with a

R1.6 bil­lion guar­an­tee in favour of Tegeta so that it could pur­chase the Op­ti­mum mine, means that Eskom, for all pur­poses, “bought” the mine and handed it over to Tegeta.

The guar­an­tee pro­vided to Tegeta was signed in De­cem­ber 2015. Ac­cord­ing to Singh, the money for the guar­an­tee was never used, but it nev­er­the­less put Tegeta in a po­si­tion to con­vince the Op­ti­mum’s two busi­ness res­cue prac­ti­tion­ers, Piers Mars­den and Peter van der Steen, that Tegeta could pay the pur­chase price for the mine.

This means that the Tegeta guar­an­tee was signed in the same month that Molefe al­legedly told Pem­bani that Eskom would not con­clude a con­tract with it.

The trans­ac­tion was con­cluded shortly there­after, on De­cem­ber 11 2015.

Singh yes­ter­day said he knew noth­ing about Pem­bani’s in­ten­tion to buy Op­ti­mum.

For­mer pub­lic pro­tec­tor Thuli Madon­sela re­vealed in April last year that Eskom made a pre­pay­ment of just less than R659 mil­lion to Tegeta. The pay­ment was ap­proved by Eskom’s board of di­rec­tors on an ur­gent ba­sis, on the same day that Tegeta was sup­posed to pay the fi­nal amount due on the pur­chase of Op­ti­mum.

Brian Molefe

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.