June 8, 2018 / 7:23 PM / 2 years ago

Glencore faces additional legal challenge over Congo mine

DAKAR (Reuters) - A Congolese-American businessman is seeking more than $1 billion (£745.5 million) in a Congo court from two Glencore (GLEN.L) executives and their ex-partner in a copper and cobalt mine, saying they defrauded him when he relinquished his shares, a court document showed.

FILE PHOTO: The logo of commodities trader Glencore is pictured in front of the company's headquarters in Baar, Switzerland September 30, 2015. REUTERS/Arnd Wiegmann/File Photo

In a statement on Friday, Glencore denied Charles Brown’s allegations, made in a summons in March, against Glencore CEO Ivan Glasenberg and senior executive Aristotelis Mistakidis. It said the company had had “no interactions whatsoever with Mr. Brown” and that his accusations are “vexatious and baseless”.

Brown’s lawyer Camille Kosi’isaka provided the document, which none of the parties commented publicly on at the time, to Reuters on Friday.

Glencore said it understands that Brown sold his indirect shares in the Mutanda copper and cobalt mine in southeastern Democratic Republic of Congo to Glencore’s former partner on the project, the now-defunct Groupe Bazano, in 2004 and 2005. That was before Glencore purchased its initial stake in the mine in 2007. Glencore is now the sole owner of Mutanda.

Brown’s claim says he sold it in 2012.

His suit is the latest legal headache in Congo for Glencore, which is also locked in disputes with state miner Gecamines over a copper and cobalt project and its former partner in Mutanda Israeli billionaire Dan Gertler..

Glencore is also threatening legal action against a new mining code, signed into law in March, that raises taxes and royalties on operators and eliminates 10-year exemptions they previously enjoyed against changes to the fiscal regime.

Alex Hamze, the former director of Groupe Bazano, who is the other defendant named in the summons, could not be reached for comment at the number listed for him in a chamber of commerce directory.

In the summons, which was filed with a court in Congo’s capital, Kinshasa, Brown alleged that he sold his 19.12 percent stake under duress in 2012.

He said he was sequestered in a law office in Kinshasa on May 9, 2012 and forced to sign over his shares to Groupe Bazano “with violence and threats” and received only $6.39 million. Brown claims the shares are worth over $1.1 billion.

Brown did not specify the role Glasenberg, Mistakidis and Hamze are alleged to have played except to say that they were “acting as either instigators, authors, co-authors or accomplices”.

Glencore purchased Bazano’s stake in Mutanda less than two weeks later on May 22, 2012.

“Glencore denies the allegations made by Mr. Brown relating to Glencore, any member of its group and any of its officers and employees,” the company said.

It added that Brown has had four binding judgements against him in Congo regarding the transactions in question.

Kosi’isaka declined to respond to that charge. The next hearing in the case is scheduled for July 2 in Kinshasa, he said.

Editing by Tim Cocks, David Goodman, William Maclean

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below