Claim that Glencore used Ramaphosa to strong-arm Eskom 'ridiculous'

10 June 2021 - 11:40
Glencore fell out with Eskom when it sought to have the coal price increased threefold in 2015. Stock photo.
Glencore fell out with Eskom when it sought to have the coal price increased threefold in 2015. Stock photo.
Image: 123RF/adam88x

Former CEO at Optimum Coal Holdings, the holding company of Optimum Coal Mine an erstwhile coal supplier at Eskom Clinton Ephron, on Thursday dismissed allegations that Glencore used President Cyril Ramaphosa to strong-arm Eskom over an increase of the coal price.

Ephron is appearing at the state capture inquiry to respond to allegations against Glencore made by former Eskom executives Matshela Koko and Brian Molefe.

Koko and Molefe told the Zondo commission that the nexus of the collapse of the coal supply agreement between Eskom and Optimum was that Glencore, when it acquired Optimum, had not done due diligence because it counted on Ramaphosa to be a shield in getting its way with Eskom.

Ephron admitted that the Glencore “did not do a comprehensive due diligence” when it acquired Optimum but added that Ramaphosa being a shareholder had nothing to do with it.

“There are two mechanisms in buying a listed company, one can approach the company or you can approach the shareholders directly and secure a certain amount of shareholding in a company,” said Ephron.

“The reason we did not approach OCH [Optimum Coal Holdings] directly, they would have had to put out a statement that its share price may be affected. We elected to approach individual shareholders directly.

“There is not an iota of evidence that points to Glencore wanting to rely on Mr Ramaphosa as a shareholder, it is ridiculous [to suggest otherwise]. Nowhere has it ever come up that Mr Ramaphosa was ever involved in any negotiation around the CSA [coal supply agreement] with Eskom.

“We strongly deny this allegation.”

Glencore fell out with Eskom when it sought to have the coal price increased threefold in 2015.

The final nail in the Optimum coffin was hammered by then Eskom CEO Molefe when he refused the coal price increase, leading to Glencore selling Optimum to Gupta-owned Tegeta.

Molefe and Koko have insisted that Eskom was well within its right to refuse to give in to Glencore's request for the increase of the coal price as their financial woes were self-inflicted and had nothing to do with the power utility. 

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