The Zambian government is expected to make a final decision on the sale of Mopani Copper Mines this month, securing a new investor for the assets it bought from Glencore in 2021, a source with knowledge of the matter said.
Zambia's Mines Minister Paul Kabuswe had initially said a new investor for the copper mines, which are struggling to make a profit, would be selected by the end of July.
The process has been delayed by complex negotiations, as it also involves Glencore, which Mopani owes money, the source said. Glencore has previously said it will not comment on the sales process as it has exited the assets.
ZCCM IH, a unit of the Zambian government, is being advised by Rothschild & Co on the Mopani sale.
It has presented investment proposals to the government that include South African platinum miner Sibanye-Stillwater, an investor from United Arab Emirates with links to International Holding Company (IHC), and China's Zijin Mining Group, the source said.
The process is nearing completion, with ZCCM and the government expected to finally make the selection this month.
ZCCM took control of Mopani from Glencore after agreeing to pay the Swiss commodities giant $1.5 billion (R211bn) in a deal funded by debt.
Zambia's president Hakainde Hichilema wants new investors in Africa's second-largest copper producer and aims to triple output of the metals key to the clean energy transition and to driving growth in battery electric vehicles. ZCCM, when approached for comment on the timeline for a sale, referred to a September 29 speech by Finance Minister Situmbeko Musokotwane, in which he said the selection of an investor for Mopani was “imminent”.
Among the investors that ZCCM has been evaluating, Sibanye-Stillwater stands out because of its experience reviving some of South Africa's oldest and struggling gold and platinum mines, the source said.
Sibanye-Stillwater is now fine-tuning its financing plans for Mopani, the source added.
Neal Froneman, the CEO of the Johannesburg-based precious metals miner, which confirmed its bid for Mopani earlier this year, said the sale process was still under way.
“I sense that they now do want to bring it to a close quite quickly,” Froneman said.
The UAE investor has a strong financial position, but limited mining experience, the source added.
China's Zijin offered a good blend of financial strength and mining expertise, but the global macro-economic environment and uncertainty in commodities could be limiting its interest in Mopani, the source added.
REUTERS