Court order blocks sale of Guptas’ Optimum Coal Holdings

The High Court in Pretoria has granted a preservation order for the Guptas’ Optimum Coal Holdings, including the Optimum Coal Mine (OCM) and the Optimum Coal Terminal (OCT), in terms of the Prevention of Organised Crime Act (POCA).

Both the OCM and OCT had been in business rescue since 2018.

The High Court handed down judgment earlier on Wednesday, where two applications heard together were granted in favour of the NPA’s Investigating Directorate.

The first pertained to all of Gupta-owned Tegeta shares in Optimum Coal Mine (OCM) and Optimum Coal Terminal. It also includes OCM’s business.

All is preserved under section 38 of the Prevention of Organised Crimes Act 121 of 1998.

The second pertained to the claim of R1.3 billion of Templar in relation to OCM, which was also preserved. This takes the total preservation to R3.4 billion.

In court papers, the underlying claim to the Templar stake preserved are funds that were advanced by the Gupta family Dubai Company, Griffin Line Trading LLC, a company nominally controlled by Ajay Gupta’s son, Kamal Singhala.

In its application, the ID had argued that all of the assets were acquired with the proceeds of crimes perpetrated against South African SOEs, including Transnet and Eskom.

According to the NPA, Daniel McGowan, the owner of Templar, has himself stated under oath that the funds advanced by Griffin Line derived from money stolen from the South African government and laundered via Singhala on behalf of his father and wider family members.

The order further states that once the curator has valued the OCM, the curator and the Business Rescue Practitioners will find a purchaser for OCM to its fair value. The curator is required to serve his report within 70 days of the granting of the order to all opposing the anticipated forfeiture application.

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The High Court also invited interested parties who wish to oppose the forfeiture of the mine and its business to the state to apply for an order excluding their interest from the forfeiture order.

Reads part of the order: “The preservation order proposed by the NDPP makes provision, inter alia, for a preservation order in terms of section 38 (2) of POCA in respect of all the shares held in OCM and OCT as well as the business of OCM. It also provides for the appointment of a curator bonis with certain powers, duties and authority subject to the business rescue practitioners of OCM retaining control of the business of OCM and to exercise all powers in respect of that business that they are lawfully vested with.

“It also makes provision for the right of any interested party to apply to this court for a variation or the setting aside of this order in terms of section 47 of POCA. Finally,it provides for notice to be given in terms of section 39 of POCA, the right of any respondent or any other person to oppose the application for an order forfeiting the property to the State or to apply for an order excluding his or her interest from a forfeiture order in respect of the property.”

“The ruling by Judges D. Fourie and M Mbongwe who heard both matters together, has now cancelled the implementation of the OCM Business Rescue Plan, which would have had OCM sold to Liberty Coal. A sale which would have legitimised the proceeds of crime,” said the NPA.