Absa cuts ties with Gupta’s Oakbay company: report

 ·3 Apr 2016

Absa has joined auditing firm, KPMG, in cutting ties with the Gupta’s listed company, Oakbay Resources & Energy, according to a report by the City Press.

It leaves the R10 billion company without its auditors, its sponsor and its banker, the paper said.

KPMG terminated its business relationship with the Gupta business empire earlier this week due to the political storm surrounding the family’s friendship with President Jacob Zuma.

KPMG was the auditor for all Gupta-owned and-controlled businesses and performed a variety of other services for the Guptas, who are allegedly at the heart of a ‘state capture’.

City Press reported that JSE sponsor Sasfin has also served notice on Oakbay, while banking group Absa, has also confirmed it will no longer serve Oakbay.

“In our view, the association risk is too great for us to continue,” KPMG chief executive Trevor Hoole reportedly told staff in an internal email.

“There will clearly be financial and potentially other consequences to this, but we view them as justifiable.”

Sasfin, which cut ties last month but will stay on until June 1, said it had taken a decision “to align Sasfin Capital’s corporate finance division’s strategic objectives” with the broader group.

City Press noted that Oakbay is obliged to find a new JSE sponsor within 30 days and a new approved auditor, under the exchange’s rules.

The full article is contained in the Sunday 3, April 2016 edition of the City Press.

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