The International Resources Holding (IRH), a unit of United Arab Emirate (UAE)’s International Holding Company (IHC) has announced its bidding withdrawal to acquire 51 per cent stake in Vedanta Resources’ Zambian copper mines.
This is after talks collapsed on Wednesday this week because of a failure to agree on the assets’ value.
As Reuters reports, IRH had offered over $1 billion to buy stake in Vedanta’s Konkola Copper Mines (KCM) in April with intentions to have the mines to consolidate its copper position in Zambia after buying a 51% stake in Mopani Copper Mines in a deal concluded in March.
“We are currently not pursuing the acquisition of a majority stake in the Zambian assets. We ended the transaction discussions two months ago due to valuation discrepancies,” IRH told Reuters.
The UAE and the even larger regional oil power Saudi Arabia are striving to secure critical metal supplies from Africa in an effort to participate in the transition to green energy.
Vedanta owns 80% of KCM, while the Zambian government holds the rest through ZCCM-IH (ZCCM.LZ).
In June, Chris Griffith, CEO of Vedanta Base Metals said that IRH was among investors conducting due diligence on the Zambian assets.
According to a source who spoke to Reuters, IRH offered about $1 billion for a 51% stake in KCM, but Vedanta only wanted to sell a 30% stake for nearly double that amount. The source remained anonymous due to lack of authorization to speak publicly.
Vedanta, owned by Indian billionaire Anil Agarwal, regained control of KCM last year after a five-year battle with former Zambian president Edgar Lungu’s administration, which accused the company of failing to expand copper production.
It is now seeking to sell a stake in KCM to raise $1.2 billion to settle debts, revive operations, and invest in the Konkola Deep Mining Project, one of the world’s richest copper deposits.
