HomeBase MetalsVedanta ups Konkola stake to almost 80%

Vedanta ups Konkola stake to almost 80%

One of Vedanta’s
mining operations
in India
Lusaka, Zambia — MININGREVIEW.COM — 18 April 2008 – India’s largest copper producer – London-based Vedanta Resources Plc – has taken up the option to buy another 28.4% in Zambian Copper Mines (KCM) for a total of US$213.15 (R1.7 billion). This raises its stake in the operation to 79.4%.

Reuters reports from here that KCM is planning expansion with the intention of raising production to 500 000 tonnes of copper by 2010 through the completion of a new mine.

“Consolidation of the group structure is a key pillar of Vedanta’s strategy, and the successful exercise of this call option is a significant milestone towards achieving this objective,” says Vedanta Resources chairman Anil Agarwal. “This transaction will substantially enhance longer term value for all our shareholders.”

Meanwhile Bloomberg News quotes Zambian trade and industry minister Felix Mutati as saying that Vedanta is planning to sell shares in its Zambian unit – Konkola Copper Mines plc – to the public.

“The government and Vedanta have reached agreement on the principle of a share sale that takes into account the need for greater Zambian ownership of companies operating in Zambia,” Mutati is reported to have said in a statement released here.

The planned initial public offering follows Vedanta’s acquisition of a further 28.4 percent of the shares in Konkola.

“We hope the share offer will be completed before the end of the year,” Mutati said in a telephone interview in Lusaka this week.

Konkola is the largest mining and metals company in Zambia, with a current annual capacity of about 200 000 tonnes of copper. It also operates the Nampundwe pyrite mine and Nkana copper smelter. Zambia is Africa’s largest copper producer.