[miningmx.com] – IT would require “lots of hard work” to drive value from Tegeta Resources & Exploration’s R2.15bn takeover of Optimum Coal, said BDLive citing Nazeem Howa, director of Tegeta’s holding company, Oakbay Investments.
Oakbay Investments is the listed company of the Gupta family who have controversial status in South Africa owing to their close business ties with Jacob Zuma, the country’s president, as well as a number of ministers.
Tegeta bought the company out of business rescue from Glencore in a transaction that was presided over by mines minister, Mosebenzi Zwane, who had been in business with the Gupta family previously.
Howa told BDLive that he could not divulge the business plan that would make Optimum a success. The mine is contracted to sell coal to Eskom for R150/tonne against costs of about R300/t – conditions that would not change under Tegeta’s ownership.
“For reasons of confidentiality, I am not able to share the business plan with you right now,” Howa told BDLive.
“We are clear that it will require lots of hard work to make this transaction work not only because of our investment, but to preserve the jobs and livelihood of thousands of people,” he said.
Optimum primarily supplies coal to Eskom’s Hendrina power station but there have been reports that it will also supply Arnot.
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