South Africa's government will lay criminal charges against Kumba Iron Ore over its application for a mining right over the company's Sishen mine it did not yet own, a lawyer for the minerals department said Wednesday.
The state's move is the latest twist in a tale that has unnerved investors and led to allegations of graft and political favouritism in the resource-rich country.
Willie Vermeulen, a lawyer for the department of mineral resources, told the North Gauteng High Court in Pretoria, that more details on the charges would be provided later.
A Kumba spokeswoman said the group -- a unit of global miner Anglo American -- would comment on the matter later.
Shares in Kumba extended losses after the news and the stock was trading 1.11 percent lower at 451.92 rand by 1037 GMT.
Disputes over mineral rights have highlighted transparency and governance issues in Africa's biggest economy after some had been awarded to people linked to high-ranking officials, sometimes over areas that were already being mined.
The dispute in court, which is at the heart of an ongoing battle between Kumba and the South African unit of steel giant ArcelorMittal , could further unnerve mining companies in the top producing country for platinum and ferrochrome and a major supplier of gold and iron ore.
Kumba has challenged the state's award of a prospecting right over a stake in Kumba's Sishen mine to little-known yet politically connected Imperial Crown Trading.
Kumba's allegations of fraud and corruption led last month to an unprecedented raid of the minerals ministry by a police investigative unit, which analysts interpreted as signalling serious flaws within a key government department.