Court denies appeal to block business rescuers from Gupta’s Oakbay office

Directors of Gupta-owned Oakbay have been denied leave to appeal a court order instructing them to allow business rescue practitioners (BRP’s) access to Oakbay’s Sandton offices‚ ending a desperate bid by to deny the BRP’s access to the premises.

A full bench of the Pretoria High Court heard arguments on the matter on April 23 and delivered judgement earlier on Thursday. Oakbay on Wednesday also filed a court bid to stop the BRP's from having a shareholders meeting next week‚ where the business rescue plans for the Gupta businesses could be adopted. The BRP's have until close of business tomorrow to file responding papers.

After two months of eight Gupta companies being under business rescue‚ Oakbay’s chief executive Ronica Ragavan and other senior managers barred the business rescue practitioners‚ Louis Klopper and Kurt Knoop‚ from being able to enter the premises.

This forced the BRP’s to bring an urgent application on April 10 as they required access to documents held at the Oakbay offices to continue running the eight companies – which includes Optimum and Koornfontein Coal Mines‚ that both supply Eskom with coal for two power stations.

The court agreed and ruled in favour of the BRP’s on April 13‚ but Ragavan and the other directors persisted. First they lodged an appeal‚ which was dismissed on 17 April. The court reinforced its previous order and interdicted Ragavan and the other directors from interfering or obstructing the BRP’s in any way.

Ragavan‚ Oakbay’s head of legal Reshma Moopanar‚ the chief financial officer Vidya Mudaliar‚ Pushpaveni Govender‚ Ashu Chawla‚ George van der Merwe‚ Mdu Mtshali and key Gupta lieutenant Salim Essa banded together and lodged a further appeal with the Deputy Judge President‚ arguing that the court had erred in granting the BRP’s application.

“The majority of the business rescue entities are involved in the supply or rendering services on behalf of the people of South Africa‚” Judge Philemon Tsoka said in his judgment on Thursday‚ adding this was particularly true with respect of coal supply to Eskom.

“[Eskom] is a national asset on which the economy and the population of this country rely for the supply of electricity…it is evident that it is in the interest…of the entire country [that these entities be rescued].

“It is therefore undisputed that the rescue practitioners in executing their duties are performing a public and statutory duty beneficial to the people of South Africa‚” he said.

For the BRP’s to complete this work‚ they would need access to the offices.

Klopper at the time of the urgent application on April 10 said the reason for the application by Oakbay‚ and for barring access to the Oakbay premises‚ was because the BRP’s had started asking “uncomfortable questions about some suspect transactions”. 

Judge Tsoka also touched on the Charles King SA transaction in which R66-million was paid by the Swiss based company as part of a sale of shares agreement for Tegeta‚ the parent company of Optimum and Koornfontein coal mines.

The sole director of Charles King SA‚ Amin Al Zarooni‚ is a Dubai businessman who has been strongly linked to the Gupta family. 

Klopper has previously stated that a questions the BRP’s asked over the Charles King SA transaction‚ which allegedly contravened Exchange Control Regulations and was flagged by Treasury‚ were also a reason for Oakbay‚ and the Guptas‚ for wanting to get rid of the BRP’s. 

Judge Tsoka said Treasury had become aware of R66-million that was paid as part of the agreement through the public media in March 2018.

Times Select first reported on the transaction after a letter from Al Zarooni to the BRP’s threatening legal action over negotiations with other potential buyers‚ was circulated to stakeholders. 

The BRP’s are facing a veritable onslaught of legal challenges. Oakbay has launched an application to have them removed Klopper confirmed during a media briefing last month. The matter is yet to be heard by the courts.

On Wednesday Times Select reported on a new application‚ brought by Gupta mines CEO George van der Merwe also to have the BRP’s removed. It is the fifth such an application.

He accuses the BRP’s of being “incompetent” and for exposing the mines to “ruinous litigation” for cancelling the Charles King SA deal. 

The BRP’s have until next week to file responding papers in Van Der Merwe’s application.