Plan for Optimum sale approved
CREDITORS of Glencore’s Optimum Coal mine approved on Friday a plan to sell it to a company controlled by President Jacob Zuma’s son and the Gupta family.
CREDITORS of Glencore’s Optimum Coal mine approved on Friday a plan to sell it to a firm controlled by President Jacob Zuma’s son Duduzane and the Gupta family.
The approval at the weekend sealed the R2.15bn sale of lossmaking Optimum to Tegeta Exploration & Resources, in which both Duduzane and members of the Gupta family have indirect interests.
Investec, FirstRand’s Rand Merchant Bank unit, and Nedbank collectively hold about R2.7bn in Optimum debt, according to a person with knowledge of the matter.
The three voted for the sale through an agent.
“The creditors got the requisite majority,” joint business-rescue practitioner Piers Marsden said on Friday.
Glencore put Optimum into business rescue in August, after Eskom refused to amend an unprofitable coal-supply contract and reduce a R2bn fine.
While the holding company would be released, the mine itself would remain in business rescue until Tegeta could show that it could run it profitably, Mr Marsden said.
“That is the million-dollar question. It’s not for today.”
Eskom said that it would not amend Optimum’s supply contract or penalty.
“Whatever happens, we don’t want to be put in a situation where we’re not going to get our money and the coal,” Khulu Phasiwe, Eskom spokesman said. Mr Marsden confirmed that the contract and penalty would remain in place.
Tegeta issued shares to Duduzane Zuma’s Mabengela Investments three weeks before the sale was announced. The African National Congress is investigating the Gupta family, who are friends of Jacob Zuma, after Deputy Finance Minister Mcebisi Jonas claimed last month the three Gupta brothers had offered to promote him to the finance minister’s job. They deny the allegation.
Mineral Resources Minister Mosebenzi Zwane has been criticised by opposition politicians, who claim he told Glencore CEO Ivan Glasenberg to do the deal with Tegeta. Tegeta said the minister had no influence over the deal, and was not involved in negotiations.
Whatever happens, we don’t want to be put in a situation when we’re not going to get our money and coal
The Mineral Resources Department had approved the sale, clearing the final regulatory hurdle, Mr Marsden said. Ministry spokesman Martin Madlala was not immediately available to comment. A spokesman for Glencore declined to comment.
It would take about 10 days after the vote to close the deal, Mr Marsden said.
On Friday, JSE-listed Oakbay Resources, which is associated with Tegeta and the Gupta family, said its nonexecutive chairman Atul Gupta and CEO Varun Gupta had resigned, while Duduzane Zuma had resigned as a director of Oakbay subsidiary Shiva Uranium.