Rescue plan to go ahead unless interdict stops it

Workers line up to get their Christmas hampers.Picture: Sizwe Sama Yende
Workers line up to get their Christmas hampers.Picture: Sizwe Sama Yende

The new business rescue plan for Vantage Goldfields SA (VGSA) mines will go ahead despite the company’s latest appeal.

Business rescue practitioner Rob Devereux said that only a court interdict would stop them from drafting the new plan after Arqomanzi – an entity formed by Siyakhula Sisonke Corporation (SSC) subsidiary, Flaming Silver 373 and Taung Gold – was the only bidder to table a concrete offer by the deadline of December 6.

VGSA claimed it had reached an agreement with Real Win Investments (RWI) to buy a 100% stake in the company, but RWI did not table its offer to the business rescue practitioners (BRPs).

Once the new plan is drafted, the matter about who the preferred buyer will be for Lily and Barbrook mines in Louisville near Barberton will be decided by creditors.

The mines were closed in 2016 and put under business rescue following the collapse of the entrance to Lily Mine and the death of three workers.

Devereux confirmed that RWI did not submit its offer and he had received only a legally binding offer from Arqomanzi.

“We are going ahead with the business rescue plan, which we will present to the creditors to decide. We will abide by the court order to continue, unless there is a court interdict,” said Devereux.

VGSA lodged an appeal against the Mbombela High Court judgment that declared Arqomanzi VGSA’s creditor after Standard Bank ceded the loan account that VGSA had with the bank to Arqomanzi.

Standard Bank ceded all of VGSA’s loans amounting to R389 million to Arqomanzi.

This smart move put Arqomanzi in the driving seat to influence the acquisition of the mines.

Arqomanzi had already made an offer worth R472 million to buy the mines but VGSA preferred RWI.

VGSA had cancelled an earlier agreement with Flaming Silver to sell the company a 74% stake after claiming that Flaming Silver did not have money to reopen the mines.

Arqomanzi is now pushing the BRPs to declare it the only offerer and that no further offers will be considered.

It argues that the VGSA and RWI transaction was irrelevant.

“The fact is that RWI should have complied with the directives of the BRPs if it wanted to remain a recognised bidder.

“We therefore fail to see how the BRPs can accept confirmation from VGSA on behalf of RWI and we contend that RWI is no longer an offerer,” said Arqomanzi’s lawyers, Lawtons Africa.

The new business plans will be published in January next year. VGSA’s CEO, Mike McChesney, has been reluctant to comment saying that “we don’t conduct our business in the press.”

READ: No way forward yet for Vantage Goldfields’ Lily and Babrook mines

SSC CEO Fred Arendse said that McChesney had been using RWI to delay the Arqomanzi deal.

“McChesney has been using RWI to delay the implementation of the Flaming Silver transaction and has caused a whole year to be lost as a result of his greed.

“We always had the IDC [Industrial Development Corporation] funding in place with Taung as our investor and partner since the beginning of the year.

“The Vantage narrative of our lack of funds was a smokescreen to push through its RWI deal in which it hoped to gain R50 million instead of the R10 million we have agreed to in our binding sale agreement,” Arendse said.

“I am pleased that the RWI consortium has realised and experienced the same conduct from Vantage and did the smart thing and walked away.

“We remain resolute in supporting our communities, affected families and former employees and opening these mines, despite McChesney’s attempts not to see these mines opened,” he said.

Arqomanzi has dispatched Christmas groceries worth R210 000 to the former employees – a gesture that Arendse said proved his company’s commitment to the reopening of the mines.

About 900 workers were laid off when the mines closed after the collapse on February 5 2016.

The former employees have decided to go underground to retrieve the container office that plunged down and was buried with three workers – Yvonne Mnisi, Pretty Nkambule and Solomon Nyirenda.

“We’re going underground to inspect how we can retrieve the container.

“We were stopped from doing that in May but nothing is happening except court cases that are taking forever. We better die trying,” said former employee Harry Mazibuko.

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