StateCaptureInquiry: Political interference and bullying were the deciding factors in Glencore's surrendering its Optimum Coal Mine to a company owned by the Gupta family.
Johannesburg - A combination of political interference and corporate bullying were the deciding factors in Glencore's surrendering its Optimum Coal Mine to a company owned by the Gupta family, the Commission of Inquiry into State Capture heard on Wednesday.
Glencore was citing a loss of R166.40 per ton on coal supplied to Eskom, or approximately R120 million per month. Ephron said that Optimum coal mine lost R829 million in 2013 alone under the Eskom contract. Ephron said the notices were "unduly harsh and disproportionate" as one was issued to halt the entire underground operations of the mine due to an oil leak in one of the trucks while other notices were issued on weekends when the department's inspectors were not on duty.
But then Glencore was approached by audit firm KPMG on behalf of Gupta-owned firm, Oakbay Investments, with an offer to purchase Optimum Holdings, which included Richards Bay Coal Terminal, Koornfontein and Optimum mines, for R1 billion. Ephron said that Tony Gupta spoke about the rehabilitation trust funds which were invested in long-term equity instruments to avoid price votality, and requested that Optimum convert the rehabilitation funds into cash equivalents.
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