New evidence strongly suggests that the Guptas and their associate Salim Essa have been pulling the strings behind a Swiss company that “bought” the Optimum Coal group from Tegeta Exploration and Resources last year and now wants the transaction to be completed.

In short, it appears that the crime family effectively wants to acquire the crown jewels of what remains of its South African assets from itself, using an offshore front.

Tegeta, a Gupta mining company, controversially bought Optimum from its original owner, Glencore, in 2016 after Eskom and then mining minster Mosebenzi Zwane allegedly leaned on the commodities multinational to sell. Eskom expanded its contracts to buy coal from the Optimum mines after the Guptas took over.

Eskom has battled to avert load-shedding due partly to poor supplies from these mines.

After the #GuptaLeaks forced the Guptas on to the back foot last year, Tegeta entered into an agreement to sell Optimum’s assets to Charles King SA, a brass plate company registered in Lausanne, Switzerland, for R2.97-billion. The assets included the Optimum and Koornfontein mines as well as Optimum Coal Terminal, which has a coveted coal export allocation via Richards Bay.

The transaction was not yet consummated when Tegeta was placed under business rescue in February this year. The rescue practitioners cancelled the sale two months later.

The matter has since been in and out of the courts and this week went into private arbitration, where the Swiss company’s representatives sought an order confirming it as the rightful purchaser.

The rescue practitioners opposed the application, which has blocked their attempts to restructure Tegeta and sell the Optimum assets to satisfy creditors. They have argued that Charles King failed to comply with key preconditions for the sale.

At the of time the sale agreement between Tegeta and Charles King on 22 August last year, the Guptas were under severe pressure, with most of their banking facilities in South Africa withdrawn.

The transaction was widely suspected of being a sham to enable them and their associates to expatriate the value bound up in Optimum. This investigation supports that conclusion, presenting new evidence that the Guptas and Essa were behind the creation of Charles King all along.

A detailed request for comment sent to a Gupta representative and Essa went unanswered this week.

A representative for Charles King sent two letters saying that “we strongly reject the accusations” but that the company was “not at liberty to discuss the transaction” pending the arbitration outcome.

The representative also threatened criminal consequences, saying among other things: “We strongly reject the accusations made in your email. Our rights are reserved and we are seeking legal advice within the jurisdictions that we exist in for legal recourse against you for any defamatory remarks against Charles King or its owner.”

The representative also threatened to report amaBhungane to the United Arab Emirates authorities for “the publication and dissemination of private documents”, which he said was “illegal in the UAE”.

Attorney Bouwer van Niekerk, representing the rescue practitioners, declined to comment given the imminent arbitration.

Al-Zarooni and the Guptas

From the start, questions were raised about Amin Jaffar Abdulla Al-Zarooni, who is supposedly Charles King’s sole shareholder via an Emirati company, Milu Limited.

Al-Zarooni has almost no online presence, despite claiming that his family has interests in interests in real estate, defence, fire-fighting, waste management and the sporting industry.

Now Al-Zarooni appears to have lied in his affidavit delivered for the arbitration hearing being conducted before retired Supreme Court judge Nigel Willis.

Al-Zarooni stated: “I did not know any of the Gupta brothers prior to the transaction that gave rise to the Charles King agreement. My interaction with the Gupta brothers was limited to the Charles King agreement. We are not friends, we do not socialise nor do we have any business dealings other than set out herein.”

This claim is flatly contradicted by evidence contained in the #GuptaLeaks, which show that Al-Zarooni visited South Africa {See  Jan 2015 ticket} as a guest of the Guptas in January 2015.

Al Zarooni Jan 2015 Ticket by janet on Scribd

Al-Zarooni applied for a multiple entry visa {see Oct visa application} in October that year, specifying {see Oct 2015 invitation letter} that he would stay at the Gupta’s Saxonwold guest house.

TimesLive reported last year that Al-Zarooni was part of a luxury hunting trip organised by Guptas during his January visit.

Also last year, amaBhungane and Scorpio reported from the #GuptaLeaks that Al-Zarooni first emerged as an apparent Gupta front when the family set up a tax avoidance scheme in Dubai for Kamal Gupta, Ajay Gupta’s son, in 2015.

They used a so-called “mudaraba” structure, which has an Emirati “owner” but where the benefits of ownership may flow to others.

In the event, Al-Zarooni was the “sole shareholder” of SKG Holdings, which was set up for Kamal Gupta’s benefit. SKG’s directors included one Soo Young Jeon, a former associate of Tony Gupta who had left South Africa to help set up the Guptas’ Dubai operations.

Now new evidence links the Guptas and their associates even more closely to Charles King via a raft of additional ties.

AGEV payment to Milu

We have previously reported on how AGEV Investment Ltd, an Emirati company purportedly 100% owned by Gupta son-in-law Aakash Garg, made payments seemingly to benefit the Guptas in a matter involving the sale of two aircraft.

Jeon, the Gupta nominee director alongside Al-Zarooni in SKG, also features as a director of AGEV.

Now we have seen evidence that AGEV made a substantial payment — AED4-million (about R15-million now) – to Milu, the company via which Al-Zarooni purportedly owns Charles King, in February.

This again suggests that the Guptas one the one hand and Al-Zarooni, Milu and Charles King on the other are all but arms-length.

Jeon did not reply to an emailed request for comment.

AGEV did not reply substantively to a new request for comment, referring instead to a lawyers’ letter sent after our previous article, which it wanted retracted on the basis it was “defamatory and libellous”, and amaBhungane’s lawyers’ response, in which we refused to retract.

Amit Tyagi and the Guptas

According to a document filed on behalf of Charles King as part of the litigation with the Tegeta business rescue practitioners, Indian national Amit Tyagi is an authorised signatory of the Charles King bank account.

In addition, company records show that Tyagi is the registered company secretary of Milu, the company via which Al-Zarooni purports to be the 100% shareholder of Charles King.

But Tyagi also appears to be tethered to the Guptas. He is listed as a director of SES Technologies in India, a company co-owned by the Guptas and whose board included Gupta lieutenant Ashu Chawla.

And he is a director of two other Indian companies, in which his co-directors are husband and wife Adesh Kumar Tyagi and Ritu Tyagi, both who feature prominently in the #GuptaLeaks emails as Gupta associates.

They were invited to South Africa {see  invitation letter} as guests of Tony Gupta in November 2012, and were guests at the infamous Sun City wedding and other occasions. Adesh Tyagi appears to have assisted the Guptas in various ways, including sourcing property in Delhi and suggesting suitable brides for one of the Gupta sons.

We established contact with Amit Tyagi on WhatsApp but he did not reply after a brief initial conversation. The other Tyagis did not reply to an emailed request for comment.

Tyagi and another Gupta front

Amit Tyagi is also a director of another Emirati company, Quantum Investments Ltd. His co-director in Quantum is one Ramaiah Ponnusamy, who is also a director of Fidelity Enterprises Ltd. We were unable to trace Ponnusamy for comment.

Fidelity, one of the earliest known Gupta fronts in the UAE, is coincidentally a shareholder in Tegeta alongside the Guptas, Essa and others.

Salim Essa – hidden role in Charles King?

We have also obtained information that Essa was consulted in managing the regulatory business of Charles King as early as August 2017 – and later appears to have sat behind a Charles King email address.

AmaBhungane has seen copies of emails that suggest Essa has operated from the address [email protected], which court and related documents show was used to deal with the sale agreement and the fallout after the business rescue practitioners cancelled it.

As recently at 9 September this year, [email protected] sent an email to the Dubai pug club asking for advice on where to purchase a pug puppy. The email was signed off, “Many Thanks Salim”.

A day later [email protected] forwarded information about pugs for sale to Essa’s personal email address.

‘Flipping’ the assets

It would appear that Charles King was not intending to acquire, hold and operate the Optimum assets, but was rather an intermediary via which the assets could be “flipped” to an ultimate buyer or buyers. Charles King has negotiated with a number of suitors over the past year pending it pulling off the purchase from Tegeta.

Assuming the Guptas and Essa are indeed partly or wholly behind Charles King, the purposes of such a transaction might have included taking a profit on the flip to the ultimate buyers and ensuring the proceeds stayed offshore.

The details of the 22 August 2017 sale agreement reinforce the impression that the Tegeta sale to Charles King was designed for just this scenario.

The agreement specifically provided that Charles King was entitled to sell to a third party. And notably, Charles King was given a full year to pay Tegeta the balance of R2.9-billion following an initial down payment of only R66.7-million.

In short, Charles King would not have had to come up with billions before an ultimate buyer did so. DM

The amaBhungane Centre for Investigative Journalism, an independent non-profit, produced this story. Like it? Be an amaB supporter to help it do more