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Creditors approve Glencore coal mine sale in South Africa

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Creditors approve Glencore coal mine sale in South Africa

A majority of creditors approved Glencore Plc's 2.15 billion South African rand of the loss-making coal mine in SouthAfrica to Oakbay Investments Group's Tegeta Exploration & Resources Ltd., BloombergNews reported April 7, citing Piers Marsden, administrator of the .

Investec Plc, FirstRand Ltd.'s Rand Merchant Bank unit and NedbankLtd., which collectively hold about 2.7 billion rand in Optimum debt, voted in favorof the sale through an agent.

Controlled by the OptimumCoal Holdings Ltd. unit, the mine went into business rescue proceedingsin August 2015 after Eskom rejected the company's attempts to renegotiate a 1993coal supply agreement and reduce a 2 billion rand penalty.

However, the mine will remain in business rescue until Tegetacan demonstrate how it will return the business to profit, while the holding companywill be released.

Meanwhile, an Eskom official refused to amend the supply contractor the penalty, with spokesman Khulu Phasiwe saying that "Whatever happens,we don't want to be put in a situation when we're not going to get our money andthe coal," despite Marsden confirming that the contract and penalty would remainin place.

Marsden added that South Africa's Mineral Resources Departmenthas approved the sale and that it will take about 10 days after the vote to closethe transaction.