HomeNewsSolidarity: Lily Mine investment deal falls through and causes reopening setback

Solidarity: Lily Mine investment deal falls through and causes reopening setback

On 27 May Vantage Goldfields announced it had concluded a significant investment by private gold producer and investment company AfroCan Resources Gold which is meant to help see the Lily mine reopened.

The investment was effective from 1 June 2016 for an amount of approximately US$11 million over two months.

However, according to Solidarity, AfroCan CEO Brian Barret has fallen short in keeping to his side of the deal following the company’s investment announcement.

Barret agreed to pay $2.5 million as part of the $11 million investment to the mine by the June 30 deadline, but “it transpired that Barret has allegedly let many transactions [of this nature] run aground.” This is what trade union Solidarity said in reaction to the non-payment of the agreed upon amount between AfroCan and the Lily Mine.

Gideon du Plessis, Solidarity General Secretary says following the press release made by Solidarity on the failed investment transaction, they were approached by three of Barret’s previous “victims” about similar experiences with Barrett when, by using the same modus operandi and excuses, transactions came to naught and Barret just disappeared from the scene.

“Two weeks ago, Barret addressed the Solidarity, AMCU and the Lily Mine leadership at the Nelspruit head office of Vantage Goldfields, owner of the Lily Mine, making all kinds of promises and creating many expectations, none of which materialised,” says Du Plessis.

He continues, Barret was regarded as the “knight on the white horse” who brought hope to the mine’s 900 helpless employees that their outstanding salaries of the past three months would finally be paid.

Barret’s investment would also have been used to sink a new shaft in a bid to retrieve the bodies of the three missing miners and to get the mine back into production.

Du Plessis further explains that the miners are devastated and shattered after receiving the news that Barret had led all by the nose.

“Based on Barret’s ‘investment’ and promises a large number of workers had entered into agreements with their creditors to the effect that they would be able to settle some of their debt this week. The outcome is that even more workers would now be facing sequestration,” he says.

Du Plessis states that as representatives of the workers, Solidarity and AMCU will not let the matter rest and they “will do everything in their power to expose Barret and to bring him to book”.

“This fraudulent transaction now means that negotiations with other investors, who had shown an interest previously, would have to start afresh – thus delaying the process to find a reputable investor by months,” he concludes.