AN AGREEMENT between the Industrial Development Corporation (IDC) and Oakbay Resources & Energy (Oakbay) in which the bank took shares in lieu of a loan repayment cannot be cancelled, said BusinessLive citing proceedings from a High Court hearing.
The IDC loaned R250m to Oakbay so the company could buy the Shiva Uranium mine. The bank then later agreed to take shares in Oakbay instead of cash repayments. Oakbay has since delisted from the Johannesburg Stock Exchange amid the meltdown in the affairs of the Gupta family who were the main shareholders.
The IDC’s contention is that the shares for cash agreement ought to be cancelled in order to have some R287.5m repaid which includes interest on the loan, but the High Court heard from a lawyer representing Oakbay that this cannot be done as the agreement was outside the “formal loan restructuring” contract, said BusinessLive.
Judgement in the matter has been reserved.
