Listed mining group, the Gupta-owned Oakbay Resources, has lost yet another JSE sponsor.<\/p>\n
The company’s sponsor, River Group, has given notice that it\u00a0has terminated its relationship with Oakbay, and will no longer be working with the Gupta firm as of\u00a0July 31, 2017.<\/p>\n
River group said that it was terminating its relationship with the company following a revised assessment of association risk surrounding company and its shareholders.<\/p>\n
The Gupta family and its companies are currently under extreme scrutiny following the leaking of thousands of emails implicating the them in state capture and other questionable business dealings.<\/p>\n
In 2016, Oakbay faced the threat of delisting from the JSE after major South African banks blacklisted the group, while its former sponsors, Sasfin, and auditors, KPMG, took the decision to drop the company, citing reputational concerns.<\/p>\n
JSE sponsors are normally corporate brokers, banks and other professional advisers, and must undertake to the JSE that they accept certain responsibilities, namely to assist with applications and to provide advice, on a continuing basis, regarding the application of the Listings Requirements.<\/p>\n
The sponsor is also a liaison between the company and the JSE \u2013 and any new sponsor will have to assess and deal with any concerns flags raised by the previous sponsor when it resigned.<\/p>\n
According to the JSE listing requirements, Oakbay has 30 business days to find a new sponsor on the effective date of its previous sponsor\u2019s resignation, or face being delisted from the exchange.<\/p>\n
In a statement issued on Monday, Oakbay said it was already looking for a new sponsor to take over.<\/p>\n
On Friday, Okabay reported an operating loss of R1.229 billion for the year ended February 2017, from a prior loss of R1 million.<\/p>\n
Revenue for the year grew to R462.6 million, from R273.7 million in the prior year.<\/p>\n
The total loss attributable to owners of the company jumped to R570.3 million, while headline loss per share climbed to 5.89 cents per share compared to a loss of 0.68 cents per share previously.<\/p>\n