Eskom says coal supplier Optimum mine starts business rescue proceedings

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South African power producer Eskom said on Thursday the Optimum coal mine, which is owned by the Gupta family and supplies one of the utility’s power stations, had started business rescue proceedings.

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Ajay Gupta, one of the three Gupta brothers accused of corrupt links to former president Jacob Zuma, was declared a “fugitive from justice” last week by South Africa’s chief prosecutor, while India’s Bank of Baroda, which counts the family’s operations as clients, has pulled the plug on its South African business.

South Africa’s main commercial banks have cut all ties with the Guptas, citing reputational risk. Zuma and the Guptas have consistently denied any wrong-doing.

Eskom, the sole power provider in Africa’s most industrialised economy, said it was informed by Optimum, which supplies its Hendrina Power Station, that Optimum had started business rescue proceedings on Monday.

It did not say what the rescue proceedings entailed. Optimum could not immediately be reached for comment.

Eskom said coal had been diverted from other mines to supply the power station after workers at Optimum downed tools and coal was not delivered.

Hundreds of members of the National Union of Mineworkers (NUM) marched on Wednesday at the Optimum mine to express their concerns about the operation’s viability.

Reporting by Tanisha Heiberg; Editing by Mark Potter