Glencore’s Optimum coal now in hands of S. African’s President family

The Optimum Coal mine supplied the fossil fuel to the Hendrina power station, part of the network providing electricity for Africa’s most industrialized economy. (Image from archives)

Oakbay Investments, the firm controlled by the Gupta family and South African President Jacob Zuma’s son, completed Thursday the $145 million acquisition of Glencore’s (LON:GLEN) Optimum Coal unit.

Last year, Glencore put the mine — which is the African nation’s third-largest opencast operation —  into business rescue proceedings, a form of bankruptcy. The moved followed  state power utility Eskom Holdings refusal to amend an unprofitable coal-supply contract and reduce a 2 billion-rand fine.

The finalization of the deal, comes as Oakbay struggles to regain bankers’ trust.

In an e-mailed statement, Oakbay’s Tegeta Exploration & Resources said its immediate priority for Optimum is to boost production and secure the continued employment of the unit’s 3,000 employees.

The finalization of the deal, comes as Oakbay struggles to regain bankers’ trust as all four major South African banks broke all ties over criticism that its owners, the Gupta family, have undue political influence with President Zuma.

Optimum, in production since 1971, supplies coal to both export and local thermal coal customers.

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