Zambia’s state-owned mining investment company is seeking to increase its stake in Glencore Plc’s local copper unit, Mines Minister Richard Musukwa said.
The government has set up a team to liaise with ZCCM Investments Holdings on the negotiations with Glencore, and the Lusaka-based company is in the process of hiring a transaction adviser, he said in comments broadcast by privately owned Phoenix FM radio. State-controlled radio cited Musukwa as saying that the state company wanted a majority stake.
“ZCCM-IH, a shareholder in Mopani Copper Mines Plc, has submitted an expression of interest to acquire additional shares in Mopani,” Musukwa said. “Glencore has since responded favorably.”
Glencore has a troubled relationship with the authorities in Zambia, Africa’s second-biggest copper producer. That was highlighted earlier this year by a dispute over the company’s plans to close Mopani’s operations as copper prices fell after the coronavirus pandemic knocked the global economy.
ZCCM-IH owns 10% of Mopani, Glencore holds 73.1% and First Quantum Minerals 16.9%. John Gladston, a First Quantum spokesman, declined to comment.
“Glencore can confirm that it is in discussions with existing Mopani shareholder ZCCM-IH and other shareholders regarding the potential acquisition of additional shares by ZCCM-IH from Glencore,” the global commodities company said. “The discussions are progressing and further updates will be issued as appropriate.”
The Zambian government threatened to revoke Glencore’s mining license in April and temporarily blocked Mopani’s chief executive officer from leaving the country, before the mining giant agreed to postpone putting the operations under care and maintenance for 90 days.
©2020 Bloomberg L.P.