The National Union of Metalworkers of South Africa (Numsa) has lodged an urgent high court application to block the Guptas and Duduzane Zuma from selling equipment belonging to a company that had been tasked to produce armoured vehicles for the SANDF.
Numsa general secretary Irvin Jim made the urgent application for an interdict in the High Court in Joburg against VR Laser, which has a R700-million contract with Denel to supply the army with armoured vehicles. The matter is expected to be heard on Tuesday.
The impending sale of the highly sophisticated equipment had also led to the retrenchment of 146 skilled employees in July.
Duduzane Zuma and Rajesh Gupta, through their company, Graysure Investments, have a 25% shareholding in VR Laser while the Gupta family, through their company, Aerohaven Trading, holds 10% in VR Laser.
Another Gupta business partner, Salim Essa, and Mbangela Investments have a 65% shareholding in VR Laser.
The VR Laser equipment is due to be sold on auction on Thursday after its directors, Essa and Pushpaveni Govender, filed for business rescue.
Essa and Govender claimed that their decision was prompted by the commercial banks’ decision to stop providing banking services to companies linked to the Guptas.
They then appointed business rescue practitioners Robert Kurt Knoop and Johan Louis Klopper to go ahead with the auction, arguing that the banks’ decisions had made it impossible for them to “continue trading and they became financially distressed”.
Numsa wants the court to set aside the auction arguing that there is a consortium, Crede Capital, which has made an offer to buy VR Laser.
Jim said Crede Capital had offered to settle a bill of more than R346.7million owed to creditors and to retain the retrenched employees.
Detailing reasons to stall the auction, Jim argues in his papers that VR Laser’s factory, which comprises the plant and machinery, was the only facility in the southern hemisphere capable of building sophisticated armoured vehicles such as the Finnish-designed Badger.
He said some of the 146 employees had received training from Finnish arms manufacturer Patria PLC which accredited them and VR Laser to build the Badgers.
“These are uniquely skilled employees. No other arms producer in South Africa has a workforce with this level of training and accreditation,” Jim said.
He further argues that if the new company takes over VR Laser, it would continue to utilise the terms of Denel’s R700m contract and would retain the workers.
He is asking the court to force the business rescue practitioners to convene a meeting with creditors and to table the offer to them.
“The offer will have the effect that the business of VR Laser is revived and is able to continue. VR Laser’s debts will be paid in full and the jobs of 146 employees will be saved. Duduzane Zuma, the Gupta family, Essa and Govender will be compensated for their shares,” Jim said.
Pleading for the court to hear the matter on an urgent basis, Jim said Knoop and Klopper had refused to postpone the sale and had refused to convene a meeting so that creditors could vote on a business rescue plan relating to the offer.
On Sunday, Klopper said they would abide by any decision of the court.
However, he said Numsa had lodged the court application two months after the creditors voted in favour of the sale of the goods.