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RG&E to repel liquidation, JCI confirms new Letseng bids Posted: Mon, 06 Mar 2006 [miningmx.com] -- RANDGOLD & Exploration (RG&E) said it would resist a court application brought by a minority shareholder to have the company wound up, claiming it had net assets totalling more than R1bn. As part of its rebuttal, RG&E also confirmed that sister company, JCI, was in fresh discussions to sell Letseng, its Lesotho diamond mine, possibly for more than R1bn. “There’s some attractive bids on the table, but no firm deal is yet in the offing,” said Brian Gibson, a spokesman for RG&E and JCI. It also emerged that RG&E is to begin a series of claims, starting this week, filing for the return of monies used to fund various transactions. These monies represent some of the proceeds of shares that former CEO, the late Brett Kebble, sold in RG&E’s investment, Randgold Resources. This eases some fears that the proceeds from the Randgold Resources shares could never be traced. These facts emerged after RG&E confirmed that an application for provisional liquidation had been lodged with the High Court of South Africa by Cape Town fund management firm, Trinity Asset Management. The order, also backed by some of Trinity’s clients, represented about 3.5% of RG&E’s shares, Gibson said. Gibson also disclosed RG&E was “... factually and commercially solvent”, and that annual financial statements would be issued before March 31. “There is no basis for the application on any of the grounds proposed by the Applicants. The directors of RG&E consider that the application is entirely without merit,” Gibson said. “RG&E has instructed its attorneys to file a notice to oppose the application ... [T]he directors of RG&E believe that the proposed liquidation of RG&E would be detrimental to the interests of shareholders,” he said. RG&E is allegedly owed between R500m to R1bn by CMMS, a treasury company that received and deployed monies mainly on behalf of JCI. RG&E also owns an estimated R200m worth of shares in gold company, Western Areas, and a R150m underpin forwarded to the shareholders of Inkwenkwezi. This was an empowerment consortium that failed in its attempt to buy Anglo American’s stake in Western Areas. If JCI sells Letseng, it could repay R500m to R1bn it allegedly owes to RG&E. However, Quinton George, CEO of Trinity Asset Management, said in an interview with Miningmx that he had no doubt RG&E was solvent. He contested, however, that RG&E was making no effort to retrieve the monies from JCI that he estimated at R500m. Trinity and its clients represented 9% of RG&E’s shareholders, he said. The provisional liquidation order was because RG&E had been operated to achieve a fraudulent purpose, he said. There was also a justified lack of confidence in the management of the respondent's affairs; and that RG&E’s ‘substratum’ had disappeared. Investec, which had loaned a special purpose vehicle consisting of JCI assets R460m, had stonewalled attempts to have independent directors installed on the board of RG&E, said George. Investec’s nominees for JCI and RG&E were Peter Gray (CEO of both companies), David Nurek, a non-executive of Investec, and Chris Lamprecht, who served on JCI’s board while led by Kebble.Free news alerts: click here to subscribe
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