The acquisition of Optimum Coal Holdings (OCH) by Tegeta Exploration and Resources was one of many main occasions that triggered the institution of the Zondo Commission of Inquiry into allegations of state seize, and was a central focus of the Public Protector’s report ‘State of Capture’, launched in October 2016.
The Public Protector (PP) discovered that the acquisition was pursued by way of illegal means and funded virtually solely by proceeds of crime.
The fee got here to the identical discovering, as outlined in Part VI Vol III of the Zondo Report (pages 80 to 95).
The final useful homeowners of Tegeta have been:
- The Guptas immediately or not directly held 65.13%
- Duduzane Zuma not directly held 19.49%
- Salim Essa not directly held 6.73%
- Ronica Ragavan not directly held 6.49%
- Ashu Chawla and different Gupta staff not directly held 2.16%.
The criminal venture of buying OCM
The criminal shenanigans resorted to by puppets of the Guptas have already been described within the Eskom part of the Zondo report.
Very briefly:
Brian Molefe, seconded to Eskom in April 2015, “immediately set about scuppering advanced negotiations between Eskom and Glencore” over a penalty levied by Eskom.
Molefe and Eskom board chair Dr Ben Ngubane needed to droop all mining licences to Eskom.
Then-minister of mineral sources Ngoako Ramatlhodi refused, and in September 2015 former president Jacob Zuma changed him with Mosebenzi Zwane.
Molefe additionally scuppered the sale of the Optimum Coal Mine (OCM) to the Phembani Group.
On 22 November 2015 Eskom board member Mark Pamensky oiled the best way, and suggested Atul Gupta that “Oakbay should ensure that a condition precedent for the OCH acquisition sale should be Eskom’s withdrawal of the R2.17 billion penalty claim” and suggested Atul the best way to get the deal to be accepted by the Eskom board.
Read:
When Glencore rejected a R1 billion provide from Oakbay for OCM on 25 November 2016, the Department of Mineral Resources below Zwane issued spurious notices below the Health and Safety Act in an try and shut down Glencore mines.
Glencore caved, after which Tegeta needed to come up with the money.
Former Eskom executives Matshela Koko and Anoj Singh “prepared a motivation for Eskom to prepay Tegeta R1.68 million” for a yr’s provide of coal, even supposing Hendrina seemed to be oversupplied.
The Eskom board unanimously adopted the decision to pre-pay the coal in December 2015, although this was clearly within the pursuits of Tegeta and never Eskom.
By early April 2016, Tegeta was wanting R600 million, and Eskom made one other prepayment of R659 million. The board signed off, and the fee was rushed by way of on 13 April 2016 by Singh and Molefe.
The R2.1 billion for Optimum was sourced from criminal funds
Tegeta paid the acquisition value for Optimum of R2.1 billion on 13 April 2016.
The funds used for the acquisition have been for essentially the most half proceeds of crime, detailed under:
| Source | Amount |
| Eskom pre-payment | R660m |
| Eskom fee to Tegeta | R68m |
| Oakbay ‘loan’ to Tegeta | R158.5m |
| Albatime ‘loan’ to Tegeta | R104.5m |
| Trillian Asset Management ‘loan’ to Tegeta | R152m |
| Centaur Mining ‘loan’ to Tegeta | R842.2m |
| Tegeta’s residual funds in Bank of Baroda account | R100.5m |
| Total | R2 085.7m |
- The Albatime mortgage consisted of the illegal fee of R42 million from Regiments Capital and R56.2 million stolen from the Transnet Second Defined Benefit Fund (TSDBF).
- The Trillian fee included an quantity of R93.4 million that was unlawfully paid by Transnet.
- Albatime transferred R110 million into a hard and fast deposit account at Bank of Baroda, which the financial institution used as safety to advance a mortgage of R105.5 million to Tegeta.
- Trillian’s mortgage of R152 million got here from the funds stolen from the TSDBF.
- Funds stolen from the TSDBF amounting to R160.2 million have been transferred into a hard and fast deposit account at Bank of Baroda, which the financial institution used as safety to advance a mortgage of R104.5 million to Tegeta.
- Centaur Mining obtained the quantity of R842.2 million from back-to-back services; the supply was laundered proceeds of crime.
- Noteworthy, Duduzane Zuma’s useful curiosity of 19.49% equates to a good thing about R342.8 million from criminally sourced funds.
It is a criminal offence to obtain proceeds of crime
The Zondo Commission referred to Section 2 of the Prevention of Organised Crime Act (Poca), which makes it a criminal offence to obtain proceeds of crime.
The fee is of the view that there are affordable grounds to consider that Duduzane Zuma, Salim Essa, Ronica Ragavan, Ashu Chawla and members of the Gupta household could also be responsible of contravening Section 2 of Poca.
Read Parts 5 and 6 of the Zondo Report: