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Oakbay sells mining unit for $225 million

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Oakbay Investments said on Wednesday it would sell its mining unit Tegeta for $225 million, the second sale this week in the company’s portfolio of investments caught up in an influence-peddling scandal.

Oakbay is owned by the Gupta family, business friends of President Jacob Zuma accused of using their links with the 75-year old leader to wield undue influence and win lucrative state contracts. Both Zuma and the family deny any wrongdoing.

The company said it would sell Tegeta Exploration and Resources, whose mines supply coal to South African state-owned power utility Eskom, to Switzerland-based Charles King SA for 2.97 billion rand ($225 million).

The sale is the second in the Oakbay portfolio this week. It said on Monday it had agreed to sell its stakes in the New Age newspaper and the ANN7 television news channel to Zuma ally and former government spokesman Mzwanele Manyi.

It is part of the plan by the Guptas announced a year ago to sell all their businesses in South Africa after the country’s four largest banks severed links with Oakbay, citing reputational risks in the wake of the scandal.

The three Gupta brothers moved to South Africa from India at the end of apartheid rule in the mid-1990s and went on to build a business empire that stretches from technology to the media to mining.

[Source: Reuters]

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