Home » News » General » Liquidator certifies BCL dead!

Liquidator certifies BCL dead!

Publishing Date : 26 April, 2017

Author : REARABILWE RAMAPHANE

BCL which was put under provisional liquidation last year October is not about to resume operation anytime soon. This was revealed by Nigel Dixon Warren the company provisional liquidator on Tuesday the 17th at a media briefing in Selibe Phikwe.

 

According to Dixon Warren, the 2017 February 7th date contrary to the belief of many is only a return date in which the liquidation period   does not end. “It is not usually the procedure within liquidation dealings for the liquidator to address media and issue out information to the public, but considering the amount of public interest in this matter, I have seen it fit to assemble the media and clear out certain misconceptions and misunderstanding making rounds in the publication circles that are also polluting public knowledge consumption’’ explained Dixon Warren.


He unpacked that on February the 7th, 2017, the High Court will decide if the companies being BCL Limited, BCL Investments, Tati Nickel Mine should be placed under final liquidation or the initial reasons presented to the Court can be dismissed.
“The order granted in 9th October 2016 to wind up the companies was only a provisional liquidation or rule nisi” He said.

 

“Per the court order any interested party may apply to high court to prevent the Court not to grant the final order which winds up the company’s “According to Warren the court can  decide to extent the provisional liquidation period and delay the final winding up (complete liquidation) order if it believes  necessary.

 

He further noted that for the final liquidation order to be delayed or not be granted, that would require a clear demonstration  satisfactory to the court that the companies were not insolvent “That’s to say who ever the interested party logging that application would be, will have to prove beyond reasonable doubt why the winding up petition should be dismissed, of which according to my assessment all the three companies are fatally insolvent, like there have no money or funds or whatsoever and have been making massive losses” he said.


BEYOND FEBRUARY 7TH 2017


Nigel who is a well experienced professional housed under KPMG Chartered Accountants Advisory observes that it is in the best interest of all the creditors that the companies be finally wound up into liquidation process followed to its conclusion. Further lecturing on the processes after February 7th, Dixon Warren explained that after that date the real liquidation is only beginning.

 

In his terms “After February the 7th this year formal liquidation process commences” He observes that the winding up process includes holding meetings of creditors and sale of assets, a process he revealed takes months to over a year. “What happens is that at the return date if there is no application to dismiss the final liquidation order, the Master of the High Court who oversees the liquidation  now takes the reins and convene a formal meeting of creditors’” he said.


 The creditors meetings are held so that they the creditors can prove their claims against the companies (ie have them recognized as the creditors in the liquidation) so that they can issue instructions to the liquidator and ultimately receive payment against their claim (a dividend) at the end of liquidation process if there are sufficient funds realized in the sale of assets to cover the costs of the liquidation and pay a dividend to creditors. Warren also revealed that erstwhile directors of the companies will be required to attend the two meetings of creditors so that they can answer questions by creditors and the liquidator.


“I am only a provisional liquidator appointed by the High Court, at the 1st meeting of creditors, the proven creditors now nominate the final liquidator, this doesn’t always be the same person as provisional liquidator but in many cases creditors appoint the same person for continuity as the provisional liquidator would have already be familiar with the liquidation and insolvent company records” he explained.

 

He also indicated that at that meeting, he as the provisional liquidator will present a report written in terms of Section 44 of the companies Act. “This report provides creditors with details of assets and liabilities of the companies and a reason to why the entities failed in the first place. It was also observed that if the BCL companies are put on final liquidation on the 7th February 2017 it is expected that the first meeting of creditors be held in April 2017.


Dixon-Warren noted that the date of the meeting is not set by the provisional liquidator but by the Master of the High Court. “I have to prepare a report and submit claim forms to all known creditors, considering that these companies creditors are relatively many I will need time after February 7th to undertake this” he further stipulated. The BCL Undertaker Warren further added that the second meeting of creditors of which the reins will be on the final liquidator who might not be him, will give an opportunity to creditors to further prove their claims. “Ordinarily this second meeting occurs between three to six months after the first, and the final liquidator will report on the affairs of estate and will be given direction from the creditors as to the sale of the assets”


THE RUSSIAN NORILSK MATTER


The Liquidator also cleared misconceptions on the Russian Norilsk matter which has been making rounds , BCL had entered into an a share purchase  agreement with Norilsk Nickel Mauritius and Norilsk Nickel International  Holdings Limited to acquire Norilsk interest in South African Nkomati Mine and Tati Nickel Mine in Francistown.

 

Dixon Warren explains that prior to the liquidation there was a dispute between parties to the agreement as to whether the conditions precedent was met and therefore whether the contract has full force and effect. “Since Norilsk has taken the matter to court at the High Court of Botswana and in London, there are no further comments I can make on the issues” he said observing that once the issue is dealt with at the court of law, if the case went in favor of Norilsk they can approach him and claim their rightful argument as a creditor
Dixon Warren revealed that BCL has a number of creditors which the company had entered into operational contracts with.

 

He further clarified that Pula Steel contrary to the belief of many is not part of BCL or BCL Investment, stating that it’s a separate entity which BCL has shares not affected by BCL liquidation. “As a matter of fact Pula  Steel owes BCL millions in dividends , it is actually one of the few debtors which will have to pay us soon “ he explained adding that RealZim , MTO, Glecon , Zimbabwean Copper companies also owe BCL a few chunks of millions , but emphasized that BCL creditors seat at billions all together.


THE FUTURE OF BCL MINES


Further clearing the air on BCL recommencement of operations, Provisional Liquidator Nigel Dixon Warren unpacked the status of affairs at the mine sites, company assets and potential investors. “There is absolutely no intention to restart operation at the mines , no prospects or what so ever, not anytime soon ,either after February 7th or 1st meeting of creditors , and we are looking at possibly beyond 2017” he said emphasizing that currently there are no resources available to finance operations.

 

“I have currently placed the mines under care and maintenance, that decision was very paramount to safeguard the assets and preserve the company value” he explained. Dixon Warren revealed that he was advised by professional smelter experts to shut down the BCL smelter which is the most valuable asset of the company, explaining that it would be very costly to keep it running until final liquidation is complete.


“When I arrived here the Smelter was shut down from  7th October as per order by the  main shareholder the government , but the BCL engineers advised me to restart it and operate it at a warm temperature as it gets damaged and looses value  when it’s not operational” But I later engaged an expert who consulted  the manufactures of the smelter and we arrived to a conclusion that it would cost us 5 million pula per month on fuel alone to keep the smelter operational , thus I decided to shut it down , because
the finances I have cannot accommodate that” he explained.

 

The BCL assets custodian stipulated that there is 24 hour security at both Tati and BCL sites to secure the valuable assets and equipments at the company plants and sites. “I have had instances where it’s said that someone calls the local companies claiming  the assets of BCL are auctioned requesting deposits payments , I need to clear the air on that and emphasize that   members of the public must be aware of these scams, formal communication of asset disposal will be advertised.


INTERESTED BUYERS


Though no formal offers has been made yet and far from being put forth it was revealed that a number of interested parties have come forth to   make their interests known, the liquidator observes that the interested firms and investors are both local and international entities and persons. “No formal offers has been made, you see BCL has been profitless , hence it currently has no value and no investor will make any offer on such bases , we will have to asses and look deep into what opportunities can be salvaged from these companies” he said, adding that such processes and assessment as well as investigations is part of his job and it will take time.

 

According to Warren any conclusion to sell will  be considered after the second meeting of creditors observing that it will only be looked into if it’s at the best interest of  the creditors . Said Warren “To further attest to why I am saying the mine will not reopen soon ,even after sale of BCL or investor agreement ,it will take time to do restructuring , refurbishment of equipments and re-designing of shafts to start up the mine on profitability”  ,  “No sane investor would rush to put their money in a company that has been making losses “


FORMER BCL EMPLOYESS


“As we all know I was forced to terminate over 4000 employees contracts, I have paid terminal benefits to almost all of them, only just over 180 have not yet received their benefits” explained Warren adding that reasons to  that being the 180 are still being contacted ,some changed addresses amongst other reasons. He observed that he initially retained about 400 employees to help him with care and maintenance but have reduced the number to just over 350.

 

“I have fired some of my stuff and rehired some of the initially terminated, because I operate under a limited budget and time so I cannot afford incompetent stuff” he explained, Dixon Warren noted that all former BCL employees who occupied  houses have been allowed to stay in the house. “We have signed lease with them up to 31st October 2017, and as per our agreement the occupants will not be paying rent in return we want them to keep the houses in good shape and suitable state, however as stated before occupants will pay for  their own utilities bills, ie water and electricity ” he said explaining that the date will be probably when   selling company asserts will begin.

Nigel Warren noted that having paid terminal benefits to former employee’s there was nothing more he can do as far as health services and other incentives are concerned, um told the government has taken over.
 BCL which has been in operation for the past 40 years was put under provisional liquidation last year October 9th after operations were halted 2 days earlier, The decision which is believed to have been orchestrated by state owned Mineral Corporations Limited put over 4000 miners to the streets jobless and thousands households without breadwinners and consequently shutting down the economic nucleus of the whole eastern bloc of the country.

However as reports indicate that cooper and nickel prices have bounced back by 20% the man mandated to dissolve the BCL Group told weekendpost after the media briefing that resident and settlers this side of this country should not put the mine in their plans of survival for the next few months as there is still lot of work to do ,adding that if at all investors put money the mine will only resume operation in 2018 realistically

Cartoon

Polls

Do you think the courts will help put the UDC, BMD impasse within reasonable time ahead of the 2019 General Election?

banner_14.jpg
banner_12.jpg

POPULER BRANDS