CNMC, ETG and Turkey reportedly express interest to buy KCM in Zambia

30 May 2019 (Last Updated May 30th, 2019 14:28)

China’s Nonferrous Metals Mining Corporation (CNMC), the commodity trading group ETG and an undisclosed Turkish company have plans to acquire a stake in Konkola Copper Mines (KCM), a copper mining and smelting company in Zambia.

China’s Nonferrous Metals Mining Corporation (CNMC), the commodity trading group ETG and an undisclosed Turkish company have plans to acquire a stake in Konkola Copper Mines (KCM), a copper mining and smelting company in Zambia.

Vedanta Resources, which partly owns Mumbai-listed Vedanta group of companies, holds a majority stake in KCM.

Earlier this week, Vedanta Resources announced its plans to open a dialogue with the Government of Zambia, to fight for its legal rights and oppose the appointment of a provisional liquidator to complete the closure of the KCM business.

The court has adjourned the hearing of the legal dispute until 4 June.

The government has alleged that KCM breached its operating licence and has pushed for the liquidation of KCM.

This legal case has raised concerns among international miners about a rise in resource nationalisation.

Vedanta Resources CEO Srinivasan Venkatakrishnan was quoted by Reuters as saying: “While Vedanta intends to fully defend its legal rights, we remain open to dialogue.”

“We hope to meet with the Zambian Government in the near future to discuss a mutually agreeable solution to the current situation as well as the broader challenges faced by KCM.”

Milingo Lungu of Lungu Simwanza & Company was appointed as provisional liquidator of KCM, which is currently responsible for daily operations at KCM.

“While Vedanta intends to fully defend its legal rights, we remain open to dialogue.”

Citing an anonymous government source, Reuters reported that CNMC had offered $2bn for KCM while the ETG Group held talks.

The sourced told the news agency: “The race is still open because we also have a Turkish company which is interested in KCM although no formal discussions have been held.”

KCM currently has 13,000 employees. Since 2004, Vedanta Resources has invested $3bn in the country.