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CAPE TOWN — Ironic how the wheel turns. After allegedly having had their arms twisted to sell to a Gupta/Duduzane Zuma-owned company by the Zuptoids in their heyday, Optimum Coal, a major Eskom supplier, is now under business rescue. With the banks refusing to deal with any Gupta-linked companies and staffers worried about delayed paycheques, Glencore the former principal shareholder allegedly muscled into selling the seemingly unprofitable Optimum, now wants to buy it back. The original sale reeked with then Mineral and Energy Resources Minister, Mosebenzi Zwane flying to Switzerland to meet Glencore CEO, Ivan Glasenberg, eliciting criticism from then Public Protector, Thuli Madonsela, for seemingly facilitating a Gupta deal. Glencore is not the only company now interested in buying Optimum, making one wonder how unprofitable it originally really was. The current Gupta/Zuma links and the Eskom leadership clean-up are the catalysts for Optimum’s financial collapse, much to the consternation of Numsa members who want any sale to go ahead at warp speed. It looks for all the world like State Capture unravelling. – Chris Bateman
(Bloomberg) — Glencore Plc is considering a bid for the Optimum coal operations in South Africa, which it sold in 2015 to a company part-owned by the politically connected Gupta family, according to two people familiar with the matter.
Glencore placed the mine in bankruptcy protection in 2015 after Eskom refused to renegotiate an unprofitable supply contract and issued penalties. The asset then was sold to a company owned by the Guptas and Zuma’s son Duduzane, with support from then-Mineral Resources Minister Mosebenzi Zwane, who traveled to Switzerland to meet with Glencore Chief Executive Officer Ivan Glasenberg and was later criticized by the nation’s graft ombudsman. The Guptas, Zuma and Zwane all deny any wrongdoing.
Glencore is interested in reacquiring the mine and the government has indicated it wouldn’t oppose the deal, said one of the people, who asked not to be named because the information is not public. Optimum, which is undergoing business-rescue proceedings, the local equivalent of bankruptcy protection, is among businesses linked to the Guptas that are struggling as banks refuse to work with them.
A Glencore spokesman declined to comment, citing company policy. Kurt Knoop, a business-rescue practitioner overseeing the Gupta-linked companies, and spokespeople for the Department of Mineral Resources didn’t immediately respond to requests for comment.
Some workers at the Optimum mine have not been paid on time, according to the National Union of Mineworkers. Business rescuers “should sell the mine as soon as possible” to avoid employees having to face additional risk, Livhuwani Mammburu, a spokesman for the union, said by phone.
South African miners Exxaro Resources Ltd. and Seriti Resources Holdings Ltd. have each said they would consider buying some of the Gupta coal assets. Optimum has received “expressions of interest” from parties after being placed under administration, business rescue practitioner Louis Klopper said at a meeting with creditors earlier this month.
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