Kalahari coup legal, says Majali lawyer

Sikonathi Mantshantsha | Thu, 09 Sep 2010 16:54

[miningmx.com] -- A LAWYER for Sandile Majali confirmed the businessman was a director of Kalahari Resources despite claims by the company founder that his position was gained fraudulently.

“My client (Majali) is certainly a director of Kalahari Resources,” Philip Webster of Webster Legal told Miningmx on Thursday. “I am indeed speaking on his behalf and handling the Kalahari matter.” Webster Legal acted as Majali’s representatives in extensive correspondence seen by Miningmx.

Webster said he had “just received a copy of the Cipro (Companies and Intellectual Property Office report) and that Majali and seven others were directors of Kalahari Resources, a fact Kalahari Resources chairman Daphne Mashile-Nkosi disputes as a fraudulent activity.

Mashile-Nkosi told Miningmx that she discovered on Wednesday that she and the only other director had been unlawfully removed as Kalahari Resources directors and replaced with Majali and seven other people.

“That is fraud and theft of my company,” said Mashile-Nkosi. She has laid charges of fraud against Majali and launched an urgent High Court to remove him and his colleagues.

Kalahari Resources owns a 40% share in Kgalagadi Manganese, a joint venture with Arcelor Mittal (50%) and the Industrial Development Corporation (IDC, 10%).

Kgalagadi Manganese is currently developing an underground manganese mine in the Kalahari Manganese Basin of the Northern Cape and a ore preparation facility and sinter plant in Kuruman, as well as the Coega manganese smelter in Port Elizabeth.

The projects are valued at R11bn and are expected to be commissioned in 2012. ArcelorMittal has signed an offtake agreement on 50% of the mine’s manganese ore production.

Siyanda Mining

The debacle started when Siyanda Mining Corp, which owns 8.33% of Kalahari Resources (but had no board representation), requested through Webster Legal access to Kalahari Resources’ financial records late August. Majali owns 85% Siyanda Mining Corp, which was until recently in voluntary liquidation.

However, when Kalahari Resources demanded documentary evidence of Webster Legal’s mandate to act on Siyanda Mining’s behalf, it was presented with a Siyanda Mining shareholder resolution that featured Webster himself as a director of the company. During the same period Siyanda Mining had been in liquidation and an independent liquidator handled all its affairs.

Kalahari Resources disputed the validity of the resolution as Siyanda Mining’s articles stated that only Majali and another Siyanda Mining shareholder could form a quorum and effect such resolution. “Even then, the company was in liquidation and only the liquidator could act on its behalf,” said Deon Lambert of law firm Edward Nathan Sonnenberg, acting for Kalahari Resources.

After Kalahari Resources pointed that out and refused to hand over the financial accounts, Webster Legal came out and informed it of the director changes at Kalahari Resources. A follow-up search on Cipro confirmed the changes, revealing the two directors had been replaced with “total strangers” and Majali.

The new directors all share a residential address on Louis Botha Avenue north of Johannesburg, which Miningmx visited on Thursday morning. Adjacent a dilapidated building old building with a spaza shop is the given address in an unflattering part of Johannesburg suburb, Orange Grove.

“At the moment I cannot comment on her (Mashile-Nkosi) fraud allegations,” said Webster. He insisted Mashile-Nkosi “was an individual” and that Kalahari Resources was “a separate entity”. He could not discuss the circumstances surrounding the debacle.

Approached for comment earlier on Thursday, Cipro said it was still “checking to see what happened” with the information. A detailed set of written question had still not attracted a response from the organisation at the time of writing.