Charles King deal for Gupta-linked Optimum 'a farce', says business rescue practitioner

Swiss company Charles King wants the business rescue practitioners of the Gupta-linked Optimum coal mine to recognise a sale agreement it had entered into with Optimum or to recognise a R64m deposit the company paid in terms of the deal, as a credit claim to be refunded as part of the business rescue plan.

Gupta-linked Tegeta Exploration and Resources announced in August last year that it had sold the Optimum coal mine to Charles King for R2.97bn.

Louis Klopper of Coronado Consulting Group, one of the business rescue practitioners, told Fin24 on Thursday that Charles King claims the practitioners wrongfully cancelled the agreement.

Netwerk24 reported earlier that Klopper was appointed as business rescue practitioner for Optimum in February "by eight of the controversial Gupta family's companies".

"As the business rescue practitioners, we have the legal power to cancel an agreement if it is in the interest of the company," explained Klopper.

He said the legal teams of Charles King and the business rescue practitioners agreed this week to postpone an urgent application by the Swiss company to a future date - not yet determined - to allow the business rescue practitioners sufficient time to file their answering affidavits.

A creditors meeting for among others a vote on the business rescue plan in terms of the business rescue process was also postponed in terms of the act. This was also to allow the business rescue practitioners time to file their answering affidavits against the allegations contained in the Charles King application.

Klopper told Fin24 that he regard the Optimum deal with Charles King as nothing but a "farce", because at that stage the mine already had severe cash flow problems.

"It was just a way to shift cash across the globe," Klopper told Fin24. The business rescue team proposes that Optimum rather be sold to a South African company.

In Klopper's view, the purpose of the Charles King deal was "just a front" to be able to pay salaries at the Optimum and Koornfontein mines in September. He claims to have proof that most of the money paid by Charles King as "deposit" was paid out as salaries the very next day.

"The Charles King court application plan is just an attempt to halt the business rescue process," said Klopper.

He had earlier told Netwerk24 that there is interest in buying Optimum and Koornfontein, but no progress can be made before the business rescue plan has been approved.

Fin24 approached the new legal representative of Charles King, Raees Saint, for comment, but he indicated that he could not do so without consulting with his client first.

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