A move by BCL Ltd’s provisional liquidator to nullify South African approval of a $271.3 million equity deal between the local group and South Africa’s Nkomati Mine, is a purely “tactical move”, says Russian base metal giant, Norilsk Nickel.
In 2014, BCL announced an agreement to buy 50% of South Africa’s Nkomati Mine from Norilsk Nickel, a deal that only received regulatory approval from the mines Minister there last September, but never materialised as BCL went into liquidation a month later.
When the approval was issued, it satisfied the last outstanding condition under the equity sale, meaning BCL was now liable to pay the purchase price of $271.3 million (P2.8 billion).
Mmegi has established that earlier this month Nigel Dixon-Warren, BCL’s provisional liquidator, filed suit in a South African High Court for judicial review of the ministerial approval granted for the equity sale. Should the application succeed, legal experts say BCL is hoping to see Norilsk’s claim for billions fall away or at least become negotiable.
BCL and Norilsk are presently engaged in a separate legal dispute over whether the billions are owed, with the matter hanging over ongoing efforts to secure a viable buyer for the liquidated group.
Dixon-Warren has declined to comment on the matter or confirm the existence of a case in South Africa.
However, yesterday, a spokesperson for Norilsk Nickel, Stuart Leasor said the Russian giant was aware of the case and intended to file a notice of opposition to the judicial review.
“The provisional liquidator is arguing in the judicial review proceedings that the South African court should set aside the approval on the basis that the Minister’s decision was ‘irrational’, primarily because (it is claimed)
“The judicial review proceedings appear to be a purely tactical move by the provisional liquidator to try to exert pressure on Norilsk and frustrate its claims.”
Leasor said Norilsk’s filing of opposition to Dixon-Warren’s application would argue that the judicial proceedings are “significantly out of time” coming months after the Minister’s approval and that the proceedings were also premature as a matter of South African law “as the provisional liquidator has not exhausted all of his other remedies”.
“The provisional liquidator’s decision to commence the judicial review proceedings is completely contradictory to arguments he is making in the Botswana proceedings as to his powers,” Leasor said.
“In any event, Norilsk does not accept that, if the approval were set aside, BCL’s liability to Norilsk would fall away.”
The Russian base metals giant is also arguing that the question of BCL’s liability or not to Norilsk can only be determined by the London Court of International Arbitration, where the matter was reportedly filed last year.
Meanwhile, the provisional liquidation case is back in the Gaborone High Court today after it was postponed from last month to allow the liquidators time to assess a proposed deal to acquire BCL Ltd.
Lawyers representing the liquidators are expected to shed more light on the proposed deal in today’s appearance.