The UAE’s International Resources Holding (IRH) has withdrawn a bid to buy a stake in Vedanta Resources Ltd’s Zambian copper mines, it said on Wednesday, after talks collapsed because of a failure to agree on the assets’ value.
IRH, an arm of United Arab Emirate (UAE)’s International Holding Company IHC.AD, the emirate’s richest company, had offered to buy a 51% stake in Vedanta’s Konkola Copper Mines (KCM) for more than $1 billion, Reuters reported in April.
It had wanted the mines to consolidate its copper position in Zambia after buying a 51% stake in Mopani Copper Mines in a deal concluded in March.
But IRH told Reuters it was “not currently pursuing the acquisition of a majority stake in the Zambian assets”.
“IRH terminated the transaction discussions two months ago due to discrepancies in valuation,” it added in an emailed statement.
The UAE and even bigger regional oil power Saudi Arabia are seeking to secure critical metal supplies from Africa, as they attempt to participate in the transition to green energy.
Vedanta owns 80% in KCM and the Zambian government holds the remaining shareholding through state firm ZCCM-IH.
Chris Griffith, the CEO for Vedanta Base Metals, told Reuters in June IRH was among investors conducting due diligence on the Zambian assets.
IRH offered about $1 billion for a 51% stake in KCM, but Vedanta was only willing to sell a minority equity stake of about 30% for almost double the amount IRH offered for a bigger shareholding, a source familiar with the matter told Reuters. The source declined to be named because they were not authorized to speak publicly on the issue.
Vedanta, owned by Indian billionaire Anil Agarwal, late last year regained control of KCM after a five-year battle to recover the copper mines and smelter that were seized by the administration of former Zambian president Edgar Lungu after it accused the company of failing to invest in expanding copper production.
The miner has been trying to sell a stake in the Zambian copper mines to raise about $1.2 billion required to settle debts, revive the operations and invest in advancing the Konkola Deep Mining Project, which holds one of the richest copper deposits in the world.
“Vedanta remains committed to exploring all funding options – both debt and equity – which are aligned with what we believe is in the best interests of KCM,” a spokesperson said via email.
The spokesperson declined to comment on “any ongoing discussions or negotiations” with potential partners.
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