Three in the race, as Pula Steel auction ends
Mbongeni Mguni | Friday February 15, 2019 12:30
While four bidders paid the deposit required to secure documents related to the sale, only three ultimately submitted bids for the mothballed steel plant based in Selebi-Phikwe.
On Wednesday, Pula Steel liquidator, John Hinchliffe told BusinessWeek that evaluation of the bids was ongoing, with the winning investor required to pay 20% of the winning bid, within 30 days of the award. The identity of the winning bidder will only then be revealed.
“At this point, all I can say is that the bidders are a mix of local and international investors.
“We are evaluating the bids and by Friday we should have selected the winning bid. That investor will then have a period to pay the deposit and only after that will we make the name public. “We do appreciate that there is a lot of interest in this matter from creditors to former workers who want to know where they stand,” he said.
Hinchcliffe revealed that one of the creditors had launched a legal challenge at the High Court claiming title over a specific Pula Steel asset. The case has been postponed. “I’m hoping we will be able to go ahead with the process. I’m hopeful that we will resolve that matter,” he told BusinessWeek. Pula Steel’s creditors, who are believed to be about 100 include, Citizen Entrepreneurial Development Agency (CEDA), Botswana Power Corporation and others. The creditors are understood to be collectively owed about P100 million.
Pula Steel, which was the country’s pioneering steel plant, was built at a cost of P130 million in 2015 and entered liquidation in October 2017 having operated in fits and starts due to financial and technical challenges, including shortage of its raw materials. The company was majority owned by BCL Mine with shareholding from CEDA and founders, the Verma family.