Norilsk pushes Govt. against the wall

Giant Russian mining company Norilsk has pulled another stunt by issuing summons against former BCL board members and mine’s executive management for reckless trading. Norilsk recently extended their legal battle against government to recover both business and revenue lost over the sale of its Nkomati assets by casting their net wide and included all former board members, executive management who they accuse of reckless trading under the Companies Act.

This publication has it in good authority that on 9th October, 2017, Norilsk through its attorney of record, Collins and Newman, issued a notice to board members then led by Dr Akolang Tombale, and BCL management led by Daniel Mahupela, notifying them that Norilsk intends to take legal proceedings against them this week and that they are joined together in civil action with government, Minister of Mineral Resources, Green Technology and Energy Security, and the Minister of Finance and Economic Development. Collins and Newman states that they act on behalf of Norilsk Nickel Mauritius (NNM), Norilsk Africa Property Limited, Global Mining Resources Inc, Laxan Trading Inc, all companies in the Norilsk group of companies.

They further inform both the board and management members that at the time when they held office from January 2015 the businesses of BCL and BCL International have been carried on recklessly. In particular, BCL and BCLi entered into transactions with Norilsk - the Nkomati and Tati transactions - pursuant to which they have incurred substantial liabilities to Norilsk group of companies.

“You knew or ought to have known that BCL and BCLi and their ultimate shareholders would not be able to pay their liabilities to Norilsk without direct or indirect support from the government, but nevertheless caused or permitted the liabilities to be incurred,” states the notice. Speaking to this publication, Sadique Kebonang, Minister of Minister of Mineral Resources, Green Technology and Energy Security confirmed that Norilsk has issued summonses against individuals who used to serve both in the board and management and were part of the decision making alongside with government Norilsk argues that the board and management traded recklessly by entering into contract knowing fully-well that their company BCL did not have capacity to do such transactions “As government, we are handling the matter, and we are acting on behalf of all concerned parties.

We are meeting with Minerals Development Company Botswana (MDCB) to determine the way forward and how best the matter can be resolved,” said Kebonang. Although he is aware of what Norilsk intends to do, Tombale could not be drawn into discussing the matter further, save to confirm receipt of the notice. A legal and financial expert who spoke on conditions of anonymity said that Norilsk are within their right to do that, but it is obvious that they are targeting government. He felt pity for both the former board and management because had their idea worked they would be national heroes by now, but they are now villains.