The company that has acquired the ownership of Mpumalanga’s Optimum Coal Mine (OCM), previously owned by the Guptas, says it is losing direct revenue of more than R100-million per week because the Richards Bay Coal Terminal (RBCT) refuses to grant access to its coal export allocation.
Liberty Coal, a subsidiary of Daniel McGowen’s Templar Capital, said in a letter to the RBCT board on February 23 that it had approximately one million tonnes of coal in stockpile for export.
For as long as the board failed, neglected, or refused to register Liberty Coal Terminal in RBCT’s securities register as the holder of shares in RBCT, the company could not export coal and would suffer damage as a result, Liberty Coal said through lawyers, Tabacks Attorneys.
The shares in RBCT, currently suspended, were held by Optimum Coal Terminal (OCT), which is a subsidiary of OCM, which Liberty Coal acquired following a settlement with the National Prosecuting Authority.
“The financial prejudice amounts to a loss of direct revenue of more than R100-million per week. The stakeholders in OCM and OCT’s business rescue are also prejudiced. The livelihoods of the circa 1 500 employees engaged at the Optimum Mine are in jeopardy, as are the circa 500 new jobs for the planned expansion of the KN02-KN03 operations and the reopening of the Pullenshope rail siding,” the lawyers said.
Liberty Coal and Liberty Coal Terminal said they were making every effort to maintain production in the interests of job preservation and community relations, “but without export revenue, the capital required to rebuild and refurbish critical mining infrastructure has to be diverted to meet the monthly operating expenses (including the ongoing cash calls to RBCT). This can only be sustained for so long.”
“The parties who benefit from the suspension of OCT/Liberty Coal’s export allocation and the payments of the monthly cash calls to RBCT are RBCT itself and the other shareholders, all of whom are direct competitors of OCT/Liberty Coal with a material interest in the allocation remaining suspended for as long as possible,” Tabacks said.
At that time, Liberty Coal demanded that the RBCT board take whatever steps may be necessary to note and record the form of transfer and thereafter to register Liberty Coal Terminal as the holder of 68 611 shares in RBCT’s securities register by no later than February 29.
Sunday World reported this week that Liberty Coal has since given the RBCT board two weeks from last Wednesday to grant them access to a lucrative coal export terminal.
Tabacks said in the letter Liberty Coal rejected the ongoing shifting of goalposts in the matter, which only served to benefit the likes of Glencore, Seriti and Thungela, all of which are shareholders in RBCT.
Tabacks warned that if Liberty’s demands are not met, the company would, through legal means, institute claims for damages against the RBCT, its board, and/or its shareholders.
In response, the RBCT said last Wednesday that Liberty Coal failed to meet a material condition, adding that the company’s media statement contained numerous misstatements and allegations that should be dismissed.
“The correct position is that Liberty Coal failed to meet a material suspensive condition to its indirect acquisition of the shareholders’ interest in RBCT, including the export
entitlement.”
The RBCT said the condition, known to Liberty Coal since June 2021, required OCM to transfer its business and coal mines in full to Liberty Coal.
Liberty Coal, which was a R1.3-billion creditor to the Guptas, also paid R462-million to the state without admitting liability. This was in settlement of claims that the Guptas had acquired the mine in 2016 through proceeds of crimes.
The settlement was supposed to pave the way for the mine to exit business rescue.
Tapbacks said in the February 23 letter that Liberty Coal Terminal and Liberty Coal were unaware of any formalities in the RBCT shareholders’ agreement or memorandum of incorporation that had not been complied with.
“However, there is no basis on which the foregoing could or should delay RBCT’s board in registering Liberty Coal Terminal in RBCT’s securities register as the holder of shares in RBCT, nor access to its export allocation”.
The lawyers said access to the export allocation was critical to successfully implementing the business rescue plans in OCM and OCT. “To date, however, RBCT has still not registered Liberty Coal Terminal as the holder of shares in RBCT, thereby frustrating the achievement of the end-game.”
The “end game” was an agreement between RBCT and Optimum that would allow for the resumption of coal exports, on the basis of which Liberty Coal paid RBCT up to R300-million owed by Optimum, for which the company had no liability.
