Gupta Mines' CEO Wants 'Incompetent' Business Rescue Practitioners Removed

The struggling mines are renegotiating their contracts with Eskom.
Indian businessmen, Ajay Gupta (R) and younger brother Atul Gupta.
Indian businessmen, Ajay Gupta (R) and younger brother Atul Gupta.
Gallo Images via Getty Images

The CEO of the Guptas' mines has applied to have the business rescue practitioners (BRPs) removed, accusing them of "incompetence" which is undermining the businesses, according to Times Select.

Court papers seen by Times Select reportedly show that the CEO of the Guptas' Optimum and Koornfontein mines, George van der Merwe, wants the BRPs, Kurt Knoop and Louis Klopper removed.

Klopper and Knoop and reportedly fended off many attempts to have them removed in the past, and were appointed as Gupta company directors earlier this year to oversee the business rescue of the coal mines.

Included in this is reportedly an application by the Industrial Development Corporation (IDC), which wants to recover a R250-million loan given to the Guptas in 2011 to buy Shiva Urianium. The IDC also wants the BRPs to be removed in a separate application.

On Monday, the BRPs reportedly published a business rescue plan which detailed a plan by a billionaire to buy Optimum. The plan will reportedly see a cash injection of R200-million into the companies.

This follows a report by City Press on Sunday, that Eskom was willing to pay more than double the rate it is paying for coal to Optimum to bail is out. Optimum's BRP also reportedly want to reduce the amount it supplies to Eskom every month.

Eskom is reportedly facing a supply crisis, with its coal stocks at seven power stations dropping below the minimum level of 20 days' supply. Optimum and Koornfontein are two of Eskom's biggest suppliers.

Both mines supply coal exclusively to the Hendrina and Komati power stations, City Press reported. Eskom reportedly said it was making plans to divert coal from other mines if coal supplies form Optimum and Koornfontein dropped.

But in a statement on Monday, Eskom denied that it was trying to bail out the two Gupta mines, according to Fin24.

"We wish to state categorically that to date Eskom has not agreed to any price adjustment with the business rescue practitioners and the allegations made in the City Press article yesterday [Sunday] are factually incorrect and without basis.

"Eskom has had discussions with the business rescue practitioners with a view to ensuring that they continue to perform, in terms of the coal supply agreement, and coal supply to the power station is resuscitated without further delays.

Should Eskom decide to accept any reduction of the coal supply tonnage, as proposed by the business rescue practitioners, such will be done at the current coal supply contract price," Eskom reportedly said in a statement.

Close

What's Hot