In a bid to establish an African copper mining empire, the mining investment arm of Abu Dhabi’s most valuable company has expressed interest in acquiring a majority stake in Vedanta Resources’ Zambian copper assets. The unit of International Holding Company (IHC.AD), known as International Resources Holding (IRH), has reportedly made an offer exceeding $1 billion to purchase a 51% stake in Konkola Copper Mines (KCM) from Vedanta.
This move comes as IRH seeks to expand its copper mining business in Zambia, following its recent acquisition of a 51% stake in Mopani Copper Mines. Additionally, IRH has expressed its intention to bid for a stake in Lubambe Copper Mine, which is currently up for sale.
The investment spree aligns with the broader strategy of the United Arab Emirates (UAE) and Saudi Arabia to secure critical metal supplies from Africa, potentially positioning them to participate in the global transition to green energy.
While the offer for a controlling stake is non-binding, discussions are ongoing between IRH and Vedanta. Vedanta, which aims to divest a portion of its 80% stake in KCM, has engaged Standard Chartered to manage the process, seeking to raise capital to revitalize the assets that were embroiled in an ownership dispute with the Zambian government in 2019.
The Zambian government currently holds a 20% stake in KCM through state firm ZCCM-IH. According to sources, IRH is solely interested in acquiring a controlling stake in KCM, as passive investment in the operations may not yield clear benefits, given the need for substantial investment to address financial challenges.
In response to the developments, Vedanta stated that discussions with prospective partners for short-term and longer-term financing are underway, emphasizing the sensitive nature of the ongoing discussions.