A fresh bid to liquidate Lily, Barbrook mines

Creditors of Mpumalanga’s Lily and Barbrook have started a fresh bid to liquidate the mines, after doubts that a R22 million promised payment will materialise.

The Barbrook creditors’ committee is gunning for the removal of the mines’ business rescue practitioner, Rob Devereux, for allegedly neglecting the mines’ assets.

The mines have not resumed operations since minerals and investment company Siyakhula Sonke Corporation Flaming Silver SPV signed a R190 million loan agreement with the Industrial Development Corporation (IDC) to acquire a 74% stake in Vantage Goldfields SA.

Lily and Barbrook mines, in Louisville outside Barberton, were shut down in 2016 and placed under business rescue after the entrance to the mine collapsed, resulting in the deaths of three workers.

Barbrook creditors’ committee chair Dwaine Koch said the committee withdrew its initial liquidation application because it was promised R22 million. “They also have still not provided proof that they secured the funds from the IDC. We are bringing the liquidation motion again,” he said.

He added that as a result of Devereux’s alleged neglect, a substation at Barbrook was vandalised and stripped.

Salamander Mining, which entered into a joint venture with Barbrook Mine to implement the business plan and start mining, has also expressed doubt about funding. In a letter seen by City Press, Salamander’s director, Lloyd Birrell, said he had “no evidence” of funding secured by Siyakhula and warned that this placed the joint venture under threat.

“Due to the terms and conditions of the IDC loan being undisclosed, it is impossible to determine whether these terms and conditions are able to be met
Lloyd Birrell,Salamander’s director

He said Barbrook’s director, Mike McChesney, was advised to place additional security at the substation, but that advice was not followed. He added that Salamander was still committed to the joint venture.

In a letter to Koch and Birrell, Siyakhula CEO Fred Arendse said the complaints were aligned with personal agendas. “I repeat that we have raised sufficient equity and debt funding to effectively take [the companies] out of business rescue and to open and sustain the operations going forward,” Arendse wrote. 

Sizwe sama Yende
City Press
p:+27 11 713 9001
w:www.citypress.co.za  e: Sizwe.Yende@citypress.co.za
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