The Competition Tribunal today approved the takeover of Optimum Coal Mine (OCM) and six other target firms by Tegeta Exploration and Resources on the condition that there would be no merger-specific retrenchments.
Tegeta is a black-owned operator owned by Mabengela Investments (Pty) Ltd and Oakbay Investments (Pty) Ltd (http://www.Oakbay.co.za), the holding company for the Gupta family’s businesses. OCM is controlled by Optimum Coal Holdings (Pty) Ltd (OCH). Both OCM and OCH are in business rescue.
The Competition Commission found that the proposed transaction is unlikely to substantially prevent or lessen competition in the thermal coal market. The merging parties are small players in the market and face competition from larger rivals such as Anglo American, Exxaro Coal and South 32 Ltd. Thus, there are credible alternative suppliers of thermal coal.
The Commission has recommended that the proposed transaction be approved on condition that the merging parties will not retrench any employees of the target firms as a result of the merger.
Nazeem Howa, Chief Executive of Oakbay Investments, said:
“We are delighted that the Competition Tribunal has ruled on the merger. Through this transaction we have prevented the loss of more than 3,000 jobs, by heading off an almost certain liquidation. We are committed to the future sustainability of Optimum and look forward to announcing our strategy for the business going forward.”
Once the transaction is completed Tegeta will supply a maximum of 5% of Eskom’s total coal supply.
Distributed by APO (African Press Organization) on behalf of Oakbay Investments.
Notes to Editors
For more information, please contact: corpcomm@oakbay.co.za
About Oakbay Investments and the Gupta family
Oakbay Investments (Oakbay.co.za) has invested more than R10 billion in South Africa. Oakbay Investments is 100% transparent – all numbers have been verified by one of the world’s most respected accountancy firms.
The Gupta family has a 23-year history of strong business performance and turnaround skills. This strong performance has come almost entirely via successful activity in the private sector, with less than 1% of the Group’s revenue coming from government contracts.
Sector diversification has also enabled Oakbay companies to deliver consistent growth and job creation throughout times of both economic boom and bust.
For example, 47,000 jobs have been lost in South Africa’s mining sector between 2012 and 2015. In contrast, Oakbay’s mining companies have created 3500 of jobs in the sector.
Source: Apo-Opa
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