Technically insolvent Oakbay gets R37.5m windfall

Oakbay, a company owned by the controversial Gupta business family, had a June 30 deadline to make a R37.5-million payment to the Industrial Development Corporation (IDC) as part of a loan agreement dating back to 2010.

The Mail & Guardian reports that, however, by February 28, “it was left with about R2.7 million in the bank, and its auditors saw fit to raise to raise the issue of its ability to stay afloat”.

This raised doubts on the company’s ability to service its IDC debt, dating back to when the Guptas received “R250 million for the creation of Shiva Uranium”.

The company, rumoured to be haemorrhaging R78 million monthly, allegedly “found R37.5 million to make a loan installment payment to the IDC – and the IDC is mum on where the company found this stash”.

It is reported the loan had been due to to be fully repaid in April 2013. “Instead it was radically renegotiated in June 2014 with backdated changes that saw the IDC take up shares in Oakbay worth R257-million.”