Gupta business rescue practitioners shown the door after questioning suspect transactions

2018-04-10 21:31
Ajay and Atul Gupta. (Muntu Vilakazi, Gallo Images, City Press, file)

Ajay and Atul Gupta. (Muntu Vilakazi, Gallo Images, City Press, file)

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Business rescue practitioners appointed to several Gupta-linked companies were forced to approach the South Gauteng High Court in Johannesburg on Tuesday for an urgent interdict after they were barred from the offices of the very companies they intend to rescue.

Business rescue practitioners Louis Klopper and Robert Knoop were told they were "no longer welcome" by the very Gupta-linked directors that appointed them in the first place.

This comes after the pair started asking questions about a suspicious transaction involving the sale of shares in Tegeta Resources and Exploration, the holding company for the Optimum and Koornfontein mines.

Klopper and Knoop were appointed by Gupta lieutenants Ronica Ragavan and Ugeshni Govender in mid-February this year, after several of the notorious family's businesses struggled to meet payment obligations.

The pair has been finalising business rescue plans for each of the entities placed under business rescue, including the Optimum and Koornfontein mines.

READ: More Gupta-owned companies apply for business rescue

That all changed on April 5, when Klopper and Knoop were requested to leave the premises and were barred from returning.

They then decided to approach the court on an urgent basis and asked to be allowed to perform their duties in terms of the Companies Act.

This was confirmed at a media briefing on Tuesday where Klopper said Oakbay management had launched an urgent application to remove them as business practitioners and to replace them with practitioners of their choice. 

'No offer or agreement'

But Klopper said the reason the application was taken to court was because the practitioners had started asking "uncomfortable questions about some suspect transactions".

"What they decided to do was to bar us from entering the premises. We brought an urgent application because they cannot prevent us as practitioners, from doing our job and accessing the records of the company," Klopper said.

"As we have been asking them increasingly difficult questions about questionable transactions... notably the Charles King transaction, this has been their reaction, to bar us from their offices and to withhold the information."

He added that it left them with no other option but to defend themselves in the application to remove them, which he described as spurious.

"It is quite shocking, the level these people have stooped to." 

Klopper added that the mine's management in the application had also accused the practitioners of taking bribes to favour certain entities in the buying of the mines.

He said there was no offer or agreement with anybody to sell the mines.

"The erstwhile managers are so desperate to withhold information from us, and probably criminal information away from us, that they are resorting to these tactics to remove us," Klopper said.

Compromising security

In his founding affidavit, dated April 9, Klopper begged the court to order the directors and officials of the Gupta-linked companies to co-operate and assist them.

They also requested the court to order the respondents to refrain from further obstructing or refusing the applicants and their agents access to the premises.

"The respondents requested that the practitioners and their representatives leave the premises and that they were 'no longer welcome' at the premises," Klopper claimed.

The following day, the attorneys and service providers for the business rescue practitioners, tasked with valuations of the companies, were also refused access.

READ: Optimum Coal business rescue court battle looms

The premises in question serves several Gupta-owned companies. Not all have applied for business rescue.

Oakbay Resources, in particular, claimed that the duties of the business rescue practitioners have resulted in several unknown individuals compromising the security of its office. They have denied the business rescue practitioners any access on this ground. All the accounting records and statements for the companies under business rescue are located at the premises.

The suddenly-hostile position taken by the Gupta-linked directors appears to have been precipitated by the business rescue practitioners' enquiries about a suspicious sale of shares transaction. The transaction was concluded between Tegeta Resources and Charles King SA, a Swiss company with links to the Guptas and Dubai. An earlier report by amaBhungane revealed that the GuptaLeaks show a Mr Amin Alzarooni was previously involved in fronting for the son of one of the Gupta brothers.

Tegeta received a R66m initial payment from Charles King, which triggered exchange control flags at the South African Reserve Bank. The Reserve Bank froze the transaction and raised queries with the business rescue practitioners who, in turn, asked Ronica Ragavan to explain the transaction.

READ: Gupta's Tegeta sale: Amin Alzarooni named director of holding company

On March 29 the SA Reserve Bank (SARB) requested that the business rescue practitioners provide it with information regarding the sale, including any existing or proposed agreements regarding the transfer of the shares. It also asked for full details of any payments received, including any payments to third parties.

It remains unclear why the SARB only approached the directors of Tegeta on March 29 this year, when the transaction had been in the public domain since last year.

The SARB refused to comment on the matter and instead referred enquiries back to the companies before the court.

"The SARB has no further comment on this. Please liaise with the companies with the companies before the court."

Court documents show that the business rescue practitioners started inquiring about the sale of shares of Tegeta to Charles King SA on March 29. By April 5 the directors had refused to engage with Klopper or Knoop and they were denied access to the businesses.

They are expected back in court on Wednesday to oppose an application by the Gupta-linked directors to have them removed as business rescue practitioners for the embattled businesses.

Read more on:    optimum  |  gupta family

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