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Banking facilities still elude Gupta companies

Publish date: 07 March 2018
Issue Number: 226
Diary: Legalbrief Workplace
Category: General

Standard Bank has denied that it has opened a bank account associated with the Gupta family. Business Day reports that this was after reports surfaces that the top-four bank had agreed to open bank accounts for business rescue practitioners controlling seven Gupta companies. However, Standard Banks spokesperson Ross Lindstrom has said the bank terminated all dealings with the Gupta family and all entities controlled by it with effect from June 2016, and that that decision still stood. The report quotes Lindstrom as saying on behalf of the bank: ‘Standard Bank of SA has not opened and will not open accounts with these companies. Any impression created to the contrary was created by an employee that was acting out of mandate.’

Full Business Day report

It was earlier reported by City Press that Standard Bank had agreed to open accounts for all eight of the Gupta family’s companies that entered business rescue last month – finally ending a two-year boycott of the family’s business interests by almost the entire formal banking system in SA. According to the report, the business rescue practitioners announced the banking news at the first series of creditors’ meetings being held in Kempton Park. Standard Bank held a board meeting where the issue was discussed on Friday and the bank informed the business rescue practitioners on Sunday, said Kurt Knoop, one of the rescuers. Another local investment bank had been willing to take on the business now that the Guptas were no longer in control of the businesses, he is quoted in the report as saying.

Full City Press report

Parliament's Portfolio Committee on Mineral Resources has heard, meanwhile, that there is no reason to place Optimum Coal Mine into business rescue other than the financing woes of Tegeta Exploration and the now fugitive Gupta family, says a Mining Weekly report. Goodwill Mthombeni, the chair of the Optimum branch of the National Union of Mineworkers, told the committee the union believed the reported sale of Optimum to a Swiss clothing company was not above board and that according to company statements Tegeta had made R2.2bn since it acquired the mine in 2016. Mthombeni said after a stand-off with management, permanent workers at the coal mine had begun receiving their salaries. NUM called a strike at Optimum last week in protest at workers not receiving their wages.

Full Mining Weekly report