Patrice Motsepe’s companies face lawsuit in Tanzania
South African billionaire Patrice Motsepe faces $195 million (R3.4 billion) lawsuit in Tanzania.
Tanzanian mining firm Pula Group has filed a lawsuit alleging Motsepe’s companies breached a non-compete agreement by investing in Evolution Energy Minerals, an Australian firm operating adjacent to Pula’s graphite project.
The case, one of the largest to be heard in Tanzania’s commercial court, resumes on Monday.
Motsepe is the founder and executive chair of ARM through Ubuntu-Botho Investments and is the majority shareholder in ARC.
The businessman’s affiliated companies—including African Rainbow Minerals (ARM), African Rainbow Capital, and ARCH Emerging Markets—violated a confidentiality and non-compete agreement by pursuing a rival project.
Charles Stith, chairman of Pula Group and former US ambassador to Tanzania, stated that Pula’s valuation of the lawsuit amount reflects third-party estimates of the financial impact Pula could face due to the alleged breach.
“The amount was based on a third-party valuation of what Pula stands to lose as a result of the competitive disadvantage resulting from the Motsepe associated companies’ violation of a confidentiality and non-compete agreement,” Stith said.
In response, Motsepe and his affiliated companies have firmly denied any wrongdoing.
“Pula issued summonses against ARM, ARC, Arch and Dr Patrice Motsepe, alleging breach of the confidentiality agreement … [all] deny any breach of the confidentiality agreement and also deny that there is any merit to the allegations and claims brought by Pula,” ARM told Business Times.
