NORILSK NICKEL ISSUES NOTICE OF LEGAL PROCEEDINGS AGAINST GOVERNMENT OF BOTSWANA
JOHANESBURG, SOUTH AFRICA, April 28, 2017 /EINPresswire.com/ -- MMC Norilsk Nickel Group (hereinafter “Norilsk Nickel”) has served notice that it intends to commence legal proceedings in Botswana against the Government of Botswana in respect of its involvement in the reckless trading of BCL Limited and BCL Investments Proprietary Limited (together “BCL”), with a view of recovering the USD 271 million plus damages and other costs that are owed to Norilsk Nickel in relation to the sale of a 50% interest in the Nkomati mine in South Africa (“the Nkomati deal”) and the USD 6.4 million that are owed to Norilsk Nickel in relation to the sale of the Tati mine in Botswana. The Government of Botswana is the ultimate shareholder of BCL through its corporate vehicle MDCB.
The notice was served under section 4 of the State Proceedings (Civil Actions by or against Government or Public Officers) Act on the Attorney General of Botswana, the Minister of Mineral Resources, Green Technology and Energy Security, and the Minister of Finance.
Norilsk Nickel agreed in October 2014 to sell their operations in Africa to BCL for a total price of USD 337 million, though that amount was later reduced when Norilsk Nickel agreed to price concessions requested by BCL and the Government.
The Nkomati deal was designed to guarantee long-term future of BCL’s operations by securing the supply of concentrate to its smelter in Selebi Phikwe, Botswana.
Although BCL became obliged to buy Nkomati on 13 September 2016, BCL and the Government have made no attempts to complete the deal, in clear breach of the agreement with Norilsk Nickel.
In October 2016, Norilsk Nickel learned through the media that BCL had been placed by the Government into provisional liquidation in an apparent attempt to avoid its obligations towards Norilsk Nickel. Since then Norilsk Nickel has tried on numerous occasions, and through numerous channels, to reach a satisfactory and amicable resolution, but none has been forthcoming. Norilsk Nickel has therefore been left with no other option but to pursue a resolution through legal channels.
In addition to the Government taking and being involved in material decisions in relation to the management of BCL, it was also aware of BCL's financial situation throughout, and knew or ought to have known that there was no reasonable prospect of it being able to pay the amounts due to Norilsk Nickel without support from the Government.
It would appear that the Government of Botswana is in negotiations with potential investors about a possible sale of BCL. Norilsk Nickel reiterates its rights in relation to the Nkomati and Tati transactions and will continue to seek the repayment of the outstanding debts due to Norilsk Nickel by all legal means. In this regard, Norilsk Nickel expects its rights to be recognized by the Government in its negotiations and in any agreement ultimately reached in relation to BCL, failing which Norilsk Nickel reserves its rights, including to challenge any such agreement.
The notice was served under section 4 of the State Proceedings (Civil Actions by or against Government or Public Officers) Act on the Attorney General of Botswana, the Minister of Mineral Resources, Green Technology and Energy Security, and the Minister of Finance.
Norilsk Nickel agreed in October 2014 to sell their operations in Africa to BCL for a total price of USD 337 million, though that amount was later reduced when Norilsk Nickel agreed to price concessions requested by BCL and the Government.
The Nkomati deal was designed to guarantee long-term future of BCL’s operations by securing the supply of concentrate to its smelter in Selebi Phikwe, Botswana.
Although BCL became obliged to buy Nkomati on 13 September 2016, BCL and the Government have made no attempts to complete the deal, in clear breach of the agreement with Norilsk Nickel.
In October 2016, Norilsk Nickel learned through the media that BCL had been placed by the Government into provisional liquidation in an apparent attempt to avoid its obligations towards Norilsk Nickel. Since then Norilsk Nickel has tried on numerous occasions, and through numerous channels, to reach a satisfactory and amicable resolution, but none has been forthcoming. Norilsk Nickel has therefore been left with no other option but to pursue a resolution through legal channels.
In addition to the Government taking and being involved in material decisions in relation to the management of BCL, it was also aware of BCL's financial situation throughout, and knew or ought to have known that there was no reasonable prospect of it being able to pay the amounts due to Norilsk Nickel without support from the Government.
It would appear that the Government of Botswana is in negotiations with potential investors about a possible sale of BCL. Norilsk Nickel reiterates its rights in relation to the Nkomati and Tati transactions and will continue to seek the repayment of the outstanding debts due to Norilsk Nickel by all legal means. In this regard, Norilsk Nickel expects its rights to be recognized by the Government in its negotiations and in any agreement ultimately reached in relation to BCL, failing which Norilsk Nickel reserves its rights, including to challenge any such agreement.
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