Abu Dhabi’s International Resources Holding (IRH), the mining investment arm of the emirate’s most valuable company, has reportedly made an offer of over $1 billion to acquire a 51% stake in Vedanta Resources’ Zambian copper assets. This move signifies IRH’s ambition to establish a significant presence in the African copper mining sector, following its recent acquisition of a 51% stake in Mopani Copper Mines for $1.1 billion. Additionally, IRH has expressed its intention to bid for a stake in Lubambe Copper Mine, which is currently up for sale.
The surge in deals reflects the broader strategy of the United Arab Emirates (UAE) and Saudi Arabia to secure critical metal supplies from Africa, aligning with their interest in participating in the global transition to green energy. However, the offer for a controlling stake in Konkola Copper Mines (KCM) from Vedanta is non-binding, and negotiations are ongoing. Vedanta, which aims to sell part of its 80% stake in KCM to raise capital and revive the assets, has engaged Standard Chartered to manage the process.
The Zambian government, which owns 20% of KCM through state firm ZCCM-IH, is involved in the ownership dynamics. IRH’s interest in a controlling stake underscores its strategic focus on actively expanding its presence in the copper mining sector, as passive investment in the operations may not yield clear benefits due to the need for significant investment to drive profitability.
In response to the developments, Vedanta has emphasized its engagement with prospective partners for short-term and longer-term financing, while refraining from disclosing specific details due to the sensitive nature of the ongoing discussions.
This strategic move by IRH represents a significant step in its pursuit of a dominant position in Zambia’s copper mining landscape, reflecting the broader trend of increasing interest in critical metal supplies from the African continent.