Vedanta pledges to pay $250 mn to Zambia creditors before retaking mine

By Matthew Hill and Swansy Afonso

Vedanta Assets Ltd. is able to pay $250 million owed to suppliers in Zambia earlier than the corporate resumes management of copper mines that had been seized by the southern African nation’s authorities greater than 4 years in the past.  

Former President Edgar Lungu’s administration positioned Konkola Copper Mines underneath provisional liquidation in 2019, after accusing Anil Agarwal’s Vedanta of mendacity about growth plans and paying too little tax. That sparked a sequence of courtroom circumstances, culminating in present President Hakainde Hichilema looking for to resolve the dispute amicably. 

Agarwal, who’s seeking to cut back the mum or dad firm’s huge debt load, has additionally pledged to speculate $1 billion in Konkola and greater than double copper manufacturing from the operation. Zambia’s output of the steel for 2023 is forecast to plunge to the bottom in 14 years. The trade is in dire want of recent funding to make the most of surging demand for copper to gas the transition to scrub power. 

The plan to pay all collectors is “to make sure I win the hearts of the people,” billionaire Agarwal stated in an interview at Bloomberg’s Johannesburg workplace on Wednesday. “Money will never be a constraint.”

Vedanta has about $2 billion of bonds due in 2024 — a report annual invoice for the corporate, with a $1.1 billion reimbursement due in January.

For Zambia, elevating output on the mine will assist it increase tax revenues in a nation that depends on the steel for about 70% of export earnings. 

Konkola’s complexes comprise of shafts, a smelter and a refinery. It presently produces about 50,000 metric tons of completed copper from its personal mines. First Quantum Minerals Ltd. copper mines within the nation produced 390,000 tons final yr.

Vedanta, India’s largest mining firm, produces metals from aluminum to zinc. It has additionally expanded its operations in Africa, and has mines in Namibia in addition to South Africa.

“Africa is my heart,” Agarwal stated. “If I have to marry two wives, one will be India, one will be Africa.”

Different key feedback from the interview:

  • Vedanta is contemplating promoting its metal asset for as a lot as $7 billion as a result of “either we should be number one or number two or we should not be in the business.”

  • Vedanta is totally dedicated to its semiconductor foray in India, is in talks with three potential companions and can announce a deal in a month or two.

  • The corporate had earlier tied up with Hon Hai Know-how Group however the Taiwanese agency parted methods with Vedanta in July.

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