Background
Mantengu Mining Limited (MTU) is a small‐cap mining / resource investment company listed on the JSE. It reverse‐listed onto the JSE in August 2022.
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The company has an operating chrome facility (Langpan), as well as other assets and prospective projects.
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Mantengu claims that since about June 2023, there has been a sustained pattern of trading activity that has artificially depressed its share price, hurting shareholders, and potentially undermining its ability to execute growth / acquisition plans.
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What Mantengu alleges
Mantengu has made several serious allegations of “market sabotage” or share price manipulation. Key points include:
Artificially low pricing trades
Trades or orders occurring near the end of trading sessions, executed at prices well below market, with “blocks” of shares offered or sold at prices that make no financial sense once transaction costs (brokerage, fees, etc.) are accounted for.
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Naked short selling
The company alleges that some transactions involved “naked shorts” — selling shares without owning them or borrowing them — which can depress share price by increasing supply without having the backing.
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Syndicate / fronting behaviour
Mantengu claims that certain individuals, companies (including Liberty Coal), and possibly actors within the JSE have been colluding in a syndicate to drive the share price down, to sabotage deals such as Mantengu’s acquisition of Blue Ridge Platinum.
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Regulatory obstruction & lack of transparency
Mantengu says it repeatedly raised concerns with the JSE and the Financial Sector Conduct Authority (FSCA), but that these concerns were either ignored, delayed, or not acted upon in full.
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Mantengu also alleges that the JSE blocked it from publishing a full SENS (“Stock Exchange News Service”) announcement intended to warn the market about this alleged manipulation.
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Damages & dilution risk
Mantengu argues that the depressed share price impacts its access to equity facilities (when price is low, raising capital dilutes shareholders more), and potentially affects classification of transactions under JSE rules (e.g. a lower share price may cause an acquisition to be a Category One transaction, which carries more regulatory burden).
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Investigations & Findings
Several investigations and responses have come out in the wake of these allegations:
FSCA investigation
The Financial Sector Conduct Authority (South Africa) looked into the complaint.
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FSCA concluded that no evidence was found to support the allegations of share price manipulation in the transactions that were reviewed.
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Specific allegations such as naked short selling (e.g. of ~387,044 shares in early June 2024) were examined and found not to constitute “uncovered short sales.”
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The FSCA also found no improper conduct by JSE or its officials in relation to the investigated transactions.
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Mantengu’s response to the FSCA
Mantengu has disputed the completeness, scope, and thoroughness of the FSCA’s investigation. Key criticisms:
That the FSCA’s review period was too limited (not covering all time periods or all trades that Mantengu believed were suspicious).
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That some evidence (such as trade data or seized devices under court order) was not reviewed by the FSCA.
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That the FSCA’s findings exonerating JSE executives are premature or do not address all the areas alleged.
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Legal / reputational fallout
Liberty Coal has initiated a R250 million defamation claim against Mantengu, alleging that Mantengu’s public statements accusing Liberty Coal (and others) of share price manipulation are defamatory.
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Mantengu has filed a criminal complaint with the Hawks (a South African law enforcement unit) against certain JSE executives and others over the alleged manipulation.
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Mantengu is also challenging the JSE in court for refusing to allow the company to issue a full SENS announcement, which it claims is its duty when price‐sensitive information arises.
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JSE’s Position
The JSE has responded publicly that it has acted “lawfully, fairly, and appropriately,” following its statutory duties. It has argued that it is bound by confidentiality provisions and that certain allegations are speculative without confirmation.
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The JSE also says it has a market surveillance / market regulation division that reviews trading activity, and that so far, it has acted on the information reported to it. But it denies any wrongdoing or failure in its regulatory function.
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Current Status Summary
The FSCA’s investigation has been completed (at least for the set of transactions it reviewed), with a finding not to take enforcement actions.
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Mantengu continues to claim that the investigation was too limited, and that additional evidence exists that has not been considered.
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Legal processes are underway: defamation suit by Liberty Coal; criminal complaints; Mantengu seeking to force JSE to allow full disclosure; shareholders and markets are watching.
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Implications & Broader Context
This case raises several broader issues about market integrity, regulation, and fairness, especially for smaller listed companies.
Regulatory oversight & trust
For capital markets to function properly, investors need to trust that the rules are enforced. Allegations of manipulation and then findings of “no evidence” may still damage credibility if stakeholders feel some actions or evidence were not taken seriously.
Information asymmetry & disclosure
Mantengu argues that certain public disclosures were blocked (by JSE) and that trade data / evidence were not fully released or reviewed. If true, that can disadvantage shareholders who do not have access to inside information or full transparency.
Vulnerabilities of small-cap stocks
Smaller companies are often more vulnerable to speculative attacks or manipulation because of lower liquidity, less analyst coverage, and thinner float. Price drops from large orders or misleading trades can have outsized effects. Mantengu keeps highlighting that its shares at some point traded far below what the company believes to be its net asset value.
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Legal risk and defamation
Accusations made publicly carry legal risk if they are not substantiated. The defamation suit by Liberty Coal is an illustration of how serious these public allegations are. Contention between making allegations for shareholder protection vs risk of reputational damage is delicate.
Precedent for regulatory transparency
If Mantengu’s claims (or some subset) are validated, this could push for more stringent rules on how exchanges like the JSE must deal with reported suspicions of manipulation, timely disclosures, and how suspicious trades are monitored and acted upon.
Open Questions / What Remains Unclear
Despite the extensive discussion and investigation, there are still several key unanswered or unresolved matters:
Was the FSCA investigation truly comprehensive?
Mantengu claims many trades outside the ones explicitly flagged were not reviewed. The seized devices under Anton Pillar order are claimed to contain material evidence but allegedly were not reviewed (at least not publicly).
What about the role of JSE executives and internal oversight?
Mantengu alleges that certain individuals or executives at the JSE were involved or complicit, or at minimum allowed irregularities to persist. The FSCA’s investigation exonerated JSE officials in the areas it covered, but Mantengu contests whether those areas cover all of its allegations.
Specific identity of the alleged unscrupulous actors / syndicate
Mantengu has named Liberty Coal in part, but much of the alleged syndicate remains unnamed publicly. The evidence chain (who is doing what, when, how) has not, at least in available public documents, been fully exposed or adjudicated.
What would constitute sufficient proof of manipulation?
Concepts like naked shorting, trades below cost once expenses are added, irregular trading patterns — all need robust and transparent evidence, especially when raised publicly. Whether Mantengu has or can present that evidence fully is a matter of contention.
Potential fallout
If Mantengu’s allegations are partially validated, there may be fallout: regulatory reforms, possible damages to Liberty Coal, possibly to JSE’s reputation, legal liability. Conversely, if the defamation suit succeeds, Mantengu could face liabilities.
Assessment / Commentary
From what’s public so far:
Mantengu has raised serious and detailed concerns. Some of those seem plausible, especially given specific observations about discrepancies, odd trades, and their effects on company valuation.
But the regulatory result for now (FSCA’s investigation) is that the specific transactions examined were not unlawful under current regulation. That does not necessarily prove Mantengu wrong — rather, that the evidence or threshold for “manipulation” legally has not been met or proven (in the FSCA’s view).
Mantengu’s insistence on deeper review reflects that they believe some material evidence remains unexamined or excluded.
The case highlights the tension between what is legally actionable vs what is morally or commercially injurious. Even if trade activity is “lawful,” it might still have seriously adverse economic consequences for Mantengu.
Conclusion
The Mantengu vs JSE / Liberty Coal saga is a vivid example of the challenges in policing market integrity, especially for smaller players. While Mantengu has alleged a well‐orchestrated campaign to depress their share price and disrupt their strategic plans, the regulatory body (FSCA) has so far found no evidence of wrongdoing in the transactions it examined. The legal and evidentiary battles are ongoing: defamation suits, criminal complaints, and calls for broader, more transparent investigations.