GABORONE, May 23 (Reuters) - A Botswana court has overturned last month’s High Court decision to take Tati Nickel Mine out of provisional liquidation because the earlier ruling did not consider the impact on creditors.
Tati, a subsidiary of the liquidated BCL mine group, has been under provisional liquidation since October 2016. The liquidation was extended twice after liquidator Nigel Dixon-Warren requested more time to pursue a deal with investors.
The High Court took the company out of liquidation in April following the lapse of the last extension.
But Botswana’s Court of Appeal said the High Court had failed to weigh the consequences of returning an insolvent company with no income stream to service its debts.
“The decision to remove the company from provisional liquidation was precipitately and improperly discharged,” the judgment said.
“It is obvious that in reaching its decision, the High Court had no regard to the interest of the creditors of the company. This notwithstanding all signals that the provisional liquidator was acting in the best interest of the creditors.”
When it was placed under liquidation, Tati had incurred a cumulative loss of 1.6 billion pula ($160 million) and owed creditors one billion pula, with its former parent company BCL the largest creditor with 800 million pula in cash owed.
$1 = 10.0000 pulas Writing by Joe Brock Editing by Edmund Blair