Gupta deal gets Trib OK

Duduzane Zuma, the son of President Jacob Zuma. File picture: Chris Collingridge, Independent Media

Duduzane Zuma, the son of President Jacob Zuma. File picture: Chris Collingridge, Independent Media

Published Feb 23, 2016

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Johannesburg - South Africa’s Competition Tribunal approved the takeover of Glencore’s Optimum coal unit by a company owned by the Gupta family and a venture fund in which President Jacob Zuma’s son is the biggest investor.

Tegeta Exploration & Resources agreed to buy Optimum for R2.15 billion ($142 million) in December after Glencore had placed the mine under business administration because it said it couldn’t make a profit due to the terms of a coal supply due with state power company Eskom Holdings.

Tegeta is 64 percent owned by Mabengela Investments, which in turn is 45 percent held by Duduzane Zuma, according to people familiar with the matter. The Gupta family’s stake in the venture is held through Oakbay Investments.

Read also: Gordhan steps into Gupta fray

The deal may proceed on condition that Tegeta “will not retrench any employees of the target firms as a result of the merger,” Oakbay said in an e-mailed statement on Tuesday. Optimum employs more than 3 000, it said.

Tegeta will supply no more than 5 percent of Eskom’s coal needs, Oakbay said.

Peter Grauer, chairman of Bloomberg, the parent of Bloomberg News, is a senior independent non-executive director at Glencore.

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