DA seeks details of Gupta deals with Eskom

On Wednesday, the Competition Tribunal will meet to consider whether to approve the Gupta family's bid to acquire control of Optimum Coal.

If, as is expected, the tribunal approves the R2.1-billion deal, it will become effective immediately.

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DA mineral resources spokesman James Lorimer said on Friday that given the absence of competition concerns it was understandable the transaction would be approved by the competition authorities.

"But this deal has to be looked at in a wider context. It's not just coal assets, it's the facilities at Richards Bay Terminal, it's the Eskom contracts and it's the close links with senior ANC figures."

The DA would raise the matter in parliament in a bid to ensure transparency. "The Eskom contracts are the key to this deal. We will insist that Eskom discloses the details of all its contracts."

He said the involvement of the Gupta family was troubling from the start. First a cabinet minister with a record of uncomfortably close ties with the Gupta family travels to Switzerland to assist in putting together the deal, "and now we know the deal involves 'the boss's' [President Jacob Zuma] son Duduzane", said Lorimer.

The Competition Commission has recommended to the tribunal that it approve the acquisition by Tegeta on condition that there are no retrenchments "as a result of the merger". Crucially, this condition will not prevent Tegeta from retrenching workers because of the current difficult operating conditions.

It emerged from Competition Commission papers this week that Tegeta was owned by Oakbay Investments, which is controlled by the Gupta family, and Mabengela Investments, in which Duduzane Zuma has a stake. The deal sees Tegeta buying control of Optimum Coal Mine and Optimum Coal Terminal, which has facilities at Richards Bay. The companies are being bought out of business rescue and Tegeta was reportedly the only party interested in acquiring them.

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The high-profile transaction made its way swiftly through the Competition Commission process. It was filed with the commission on December 17, a week before the commission closed for its year-end break. After investigating the proposed transaction, it released its recommendation on Thursday. The tribunal will have a hearing, open to the public, on Wednesday.

The commission found that the proposed transaction was unlikely to substantially prevent or lessen competition in the thermal coal market. The merging parties are smaller players and face competition from large rivals such as Anglo American, Exxaro Coal and South32. However, the commission found the proposed merger raised public interest concerns, particularly over possible job losses, which is why it attached the prohibition on retrenchments.

Oakbay CEO Nazeem Howa welcomed the commission's recommendation and said it was good news for Optimum employees.

"Through this acquisition we have prevented a liquidation that would have seen 3000 people lose their jobs."