[miningmx.com] — WESCOAL Holdings will oppose an application to liquidate its subsidiary, Wescoal Mining, it said on Thursday.
The company is involved in a dispute with a former contractor, Sutha Civils.
“On the release of Wescoal’s results on 29 June 2011, the holding company as well as all subsidiaries were and remain solvent. Based on this we see no validity in the Sutha claim to declare Wescoal Mining insolvent,” Wescoal CEO Andre Boje said in a statement.
Sutha applied for the liquidation of Wescoal Mining on Wednesday.
“The legal team representing Wescoal Mining have been instructed to oppose the application based on the premise that the application is malicious, unfounded and has no prospect of success,” said Boje.
Sutha Civils managing director Nico Swart was not immediately available to comment.
Wescoal said it had a court interdict against Sutha precluding it from making unsubstantiated and derogatory statements about the coal miner.
Sutha had said in March it would lodge a liquidation application.
At that time, Wescoal said it had investigated alleged irregularities involving Sutha within five months of appointing the contractor to mine the West Pit at Khanyisa Colliery near Kendal in Mpumalanga.
Wescoal said it removed Sutha from the operations in December 2010.
Business Day reported in March that Sutha had laid a charge of fraud against Wescoal at the Krugersdorp police station for allegedly overstating tonnages of coal mined at Khanyisa.
Wescoal denied the charge.
Boje said Sutha’s application for liquidation was an abuse of the court process.
“Wescoal considers the application an abuse of the process of the courts, by Sutha not first proving their claim in court and may launch an application to stay the liquidation application.”
