Court opens way for action against Tegeta over unlawful coal deal

Coal is seen being transported along a conveyor belt. The Pretoria high court has ruled the R3.7bn coal supply agreement for Majuba power station between Eskom and Tegeta is invalid and unlawful. Picture: ROBERT TSHABALALA

In the judgment, handed down on Thursday, the court ruled that the R3.7bn coal supply agreement for Majuba power station signed between the utility and Tegeta on March 10 2015 is invalid and unlawful. Minister of justice & correctional services Ronald Lamola welcomed on Friday the judgment as progress in the fight against maladministration that “often lays the basis for corruption to thrive at a great expense to the fiscus and ultimately service delivery, and we are encouraged when efforts to recover resources of the people of SA are intensified and yield results”.

Business rescue is a type of bankruptcy protection provided for by the Companies Act as an alternative to liquidation. Tegeta’s four companies — Optimum Coal Mine, Koornfontein Mines, Optimum Coal Terminal and Shiva Uranium — were placed in business rescue two years ago when SA banks cut off their facilities and they became unable to transact.

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