News / South Africa

Ilse de Lange
2 minute read
20 Sep 2018
6:20 am

Swiss company fights in court to buy Guptas’ Tegeta

Ilse de Lange

Charles King SA is accusing Tegeta's business rescue practitioners of undermining the fulfilment of the conditions of a purchasing contract.

Coal. Image: Twitter/@ESIAfrica

Swiss-based company Charles King SA has accused the business rescue practitioners in charge of the Gupta-owned Tegeta Exploration and Resources of deliberately bad-mouthing them to Mineral Resources Minister Gwede Mantashe to make it impossible for them to buy the Optimum and Koornfontein coal mines.

Charles King yesterday applied for an urgent temporary interdict in the High Court in Pretoria to stop the business practitioners from selling the shares in Tegeta or any other assets pending arbitration proceedings about the cancellation of a contract in terms of which the company was to buy Tegeta.

The business practitioners, Kurt Knoop and Johan Klopper, opposed the application, arguing the contract had been cancelled legally because Charles King did not pay the full deposit and failed to comply with other terms.

Judge Sheila Mphahlele reserved judgment.

Senior counsel for Charles King, Piet Louw, argued the company had paid a deposit of R66.7 million into Tegeta’s account with the State Bank of India in September last year, leaving a shortfall of R2.3 million because of currency fluctuations.

He said when they tried to pay the shortfall into the same bank account the payment was rejected as the State Bank of India would not accept deposits for and on behalf of Tegeta and no new account details were provided.

He said Tegeta’s management had agreed they could pay the outstanding amount in due course.

Two months after Tegeta was placed under business rescue in February the business practitioners summarily cancelled the contract for their failure to pay the full deposit, without offering to pay back their massive deposit.

Louw argued the cancellation was not only unlawful, but that the business practitioners had actively undermined the fulfilment of the conditions.

For more news your way, download The Citizen’s app for iOS and Android.