Vedanta Resources Plc, owners of Konkola Copper Mines in Zambia plans to list shares of its Zambian unit KCM on London bourse through its holding company, Konkola Resources plc in which it seeks to secure more than USD 1 billion.
Mr Kishor Kumar CEO of Vedanta said that the listing of the company on the London Stock Exchange was significant for Zambia as it would help in the company’s growth and further attain higher copper production at its unit, KCM. The Initial Public Offer will provide investors with an opportunity to participate in the growth of this integrated and pure play copper company with the liquidity of a London listing.
KCM plans to further offer some of the ordinary shares for Africa’s biggest single mine to Zambians through an Initial Public Offer on the Lusaka Stock Exchange once the listing was compete in London. Vedanta Resources owns 79% stake in KCM.
Mr Kumar did not, however elaborate on the matter but sources said that the miner Zambia’s leading copper producer intends to raise about USD 1.1 billion in an Initial Public Offer ostensibly to expand its mines in Zambia and meet debt obligations.
KCM plans a separate listing on the Lusaka Stock Exchange and provide Zambians as well as its employees an opportunity to own shares in the country’s biggest private company and leading copper producer. Konkola Resources wishes to provide an opportunity for Zambian investors to invest in the company and intends to pursue a listing on the LuSE and offering of ordinary shares in Zambia shortly following admission as well as making an allocation of shares to employees.
Mr Anil Agarwal executive chairperson of Vedanta Resources said that KCM was seeking admission to the London Stock Exchange so it could trade some of the Konkola Resources plc ordinary shares. Vedanta Resources plc announced its intention to seek admission of the ordinary shares of Konkola Resources to the Official List of the UK Financial Services Authority and to trading on the London Stock Exchange plc’s main market for listed securities. On completion of the initial public offering, Konkola Resources would be the holding company of Konkola Copper Mines plc, an integrated copper miner in Zambia whose majority shares are owned by the Vedanta Group.
He said that the announcement of the intentions to list KCM was to augument Vedanta’s interim results announcement on November 11, at which management stated it was evaluating the possibility of a public listing of KCM. Following the initial public offering, Vedanta would remain a majority shareholder in the newly listed company. Zambia Consolidated Copper Mine Investment Holding is the other KCM shareholder.
KCM produced about 173,000 tonnes of copper in the 12 months through March 31 and had its earnings before interest, taxes, depreciation and amortization of USD 167.9 million in the period. Wih the increasing investment in its operations in Zambia, KCM forecasts to produce more than 400,000 tons of the copper metal per annum in the next four years.
Mr Dr Situmbeko Musokotwane finance minister of Zambia said that the Zambia’s government hailed Vedanta’s planned listing of KCM on the London bourse, describing the action a landmark achievement for not just the company but the country as a whole. We are delighted to support this landmark transaction for KCM which highlights the role of Zambia as the leading African copper producer and one of the world’s premier mining destinations.
KCM Plc is a leading integrated copper producer in Zambia. The KCM is primarily engaged in the mining, production and sale of copper and copper by products. It is a wholly owned indirect subsidiary of Vedanta Resources Plc, a London listed diversified FTSE 100 metals and mining group with operations in India Australia and Zambia among others.
With a labour force of more than 10,000 workers and operating Nchanga, Konkola copper mines as well as Nkana refinery including Nampundwe Pyrites, Vedanta Resources through its KCM unit, envisions to be a world class copper mining and metals company leveraging mineral and human resources to enhance stake holder value and become the pride of Zambia.
Since it acquired a major stake in Zambia’s copper mines, KCM in 2004, with an investment in excesss of US$1.6 billion, the miner operates among others Nchanga Concentrator, Tailings Leach Plant, Nchanga Concentrator and the Nchanga Acid Plant. It has been a leading miner in safety and occupational health standards in the mining industry, having been conferred with several awards since December 2005 by global reputed companies for high standards of occupational health and safety at all its workplaces.
According to data initially, Vedanta Resources Plc had in 2004 acquired a 51% stake in KCM in Zambia. Prior to 1970, Anglo American Corporation and Roan Selection Trust owned the mines. After negotiations between the Zambian government and the two mining groups the mines were reorganised into Nchanga Consolidated Copper Mines Limited and Roan Consolidated Mines Limited.
Through the Mining and Industrial Development Corporation Limited, the government acquired 51% interest and Zambia Copper Investments acquired the remaining 49% in NCCM. Mindeco’s 51% shareholding in NCCM was transferred to ZIMCO in September 1974. The Government acquired 51% shares in RCM. The Roan Selection Trust, ZCI and the general public held the rest.
In April 1981, RCM and NCCM were merged to form a conglomerate, Zambia Consolidated Copper Mines. A privatising program was completed on March 31st 2000 when ZCCM assets were bought by Mopani Copper Mines plc and Konkola Copper Mines plc.
Anglo American plc acquired 51% shares in KCM. In September 2002 Anglo America, IFC and CDC withdrew as shareholders of KCM, leaving a restructured company whose main shareholders were ZCCM IH and ZCI. In November 2004 Vedanta Resources became the major shareholders in KCM with 51% share in the Company.
(Filed by Mr Kapembwa Sinkamba SteelGuru Correspondent Zambia)