'Place BCL under judicial management'
Goitsemodimo Kaelo | Friday January 11, 2019 13:57
Boko said that they were deeply concerned at the lack of progress on the BCL matter and the attendant hardships caused to the former employees of BCL as well as the residents of the SPEDU region.
He expressed this in a letter addressed to the Minister of Mineral Resources, Green Technology and Energy Security, Eric Molale and copied to the Permanent Secretary to the President, Carter Morupisi, Thursday morning. The Selebi-Phikwe based mine was placed under liquidation in October 2016, with Nigel Dixon-Warren, partner at KPMG, appointed the provisional liquidator.
Almost two years since the liquidation, government has spent over P1 billion towards costs of the exercise. Over 5,000 people lost their jobs in the process. Molale told the November Parliament sitting that government’s relationship with the Liquidator is severely strained and on the verge of an irreparable breakdown.
“We get the impression that government is reluctant, unwilling or unable to resolve the matter in a prudent and positive manner.
The Liquidator seems hell-bent on a course that will result in the total destruction of BCL and the sale of its assets, especially the smelter, as scrap and at a huge loss to the country. This is deeply troubling,” said Boko.
He also expressed disappointment that the process has been entrusted to foreign professionals at the level of both the Liquidator and the Law Firm(s) engaged to handle various aspects of this matter, which he said bespeaks a government that has no faith and confidence in its own citizen professionals and that has absolutely no commitment to their empowerment. The Botswana National Front president added that they were concerned that the Liquidator was taking steps to sell various assets of BCL in a piecemeal fashion and was also in the process of closing down permanently, various mining shafts, which will destroy any likelihood of BCL being resuscitated as a viable business entity.
“We take the view, which we respectfully but firmly urge upon you and government, that BCL must be removed from liquidation as a matter of urgency and placed under Judicial Management instead,” he said.
“Judicial Management is a legal method of debt restructuring where an independent judicial manager is appointed by the Courts to manage the affairs, business and assets of a company under financial distress.
The company is then also shielded, during the period of judicial management, from legal proceedings by third parties giving it the opportunity to rehabilitate.”
He indicated that the closure of BCL was ill-advised and premature, and that it was sustainable. Clearly, Boko said, circumstances have considerably changed since the ill-fated decision to close BCL was taken and reasonable prospects exist that the Mine will overcome its financial challenges and Courts would be amenable to having it placed under Judicial Management.
He suggested that creditors, including Botswana Power Corporation, Water Utilities Corporation and Botswana Railways, all of whom are large creditors, may invoke Section 270 of the Companies Act (Cap. 42:01) and apply for Judicial Management.
“We would urge that as part of the approach suggested here a special dispensation be put into place to secure the interests of the former employees of BCL in order to mitigate and ultimately avert what is no doubt a socio-economic catastrophe which will, in any case, remain the responsibility of government from a social security perspective,” he added.
He cautioned government to act in a manner that secures BCL and BCL Investments and safeguards the immense national interests that are involved. Efforts to get any comment from Molale’s office proved futile at press time.