UAE’s IHC Withdraws Offer for Vedanta’s Zambian Copper Mines Due to Pricing

UAE’s IRH Withdraws Bid for Vedanta’s Zambian Copper Mines Over Valuation Dispute

JOHANNESBURG, July 3 (Reuters) — The UAE’s International Resources Holding (IRH) has officially withdrawn its bid to purchase a stake in Vedanta Resources Ltd’s Zambian copper mines. This decision, announced on Wednesday, comes after the collapse of negotiations due to disagreements over the valuation of the assets.

International Resources Holding (IRH) is a subsidiary of the UAE’s International Holding Company (IHC), one of the wealthiest companies in the emirate. IRH had proposed an acquisition of a 51% stake in Vedanta’s Konkola Copper Mines (KCM) for more than $1 billion. The deal was part of IRH’s strategy to expand its presence in Zambia’s copper sector, complementing its recent acquisition of a 51% stake in Mopani Copper Mines, finalized in March.

However, IRH has now declared that it is “not currently pursuing the acquisition of a majority stake in the Zambian assets.” This decision was made after discussions fell through due to disagreements regarding the valuation of KCM, which were not resolved despite ongoing negotiations.

The UAE, alongside Saudi Arabia, is actively seeking to secure critical metal supplies from Africa to support their green energy transition goals. The interest in Zambia’s copper mines is part of a broader strategy to gain access to vital resources necessary for sustainable development.

Vedanta Resources holds an 80% stake in Konkola Copper Mines, with the remaining 20% owned by the Zambian government through the state-owned firm ZCCM-IH. The company had been in talks with various potential buyers to raise funds needed to address its financial obligations and invest in the Konkola Deep Mining Project, one of the world’s richest copper deposits.

Chris Griffith, CEO of Vedanta Base Metals, had previously confirmed that IRH was among the investors conducting due diligence on the Zambian assets. Despite IRH’s bid being substantial, valued at approximately $1 billion for a 51% stake, Vedanta was only willing to offer a minority equity stake of about 30% for nearly double the amount IRH had proposed for the larger shareholding. This discrepancy in the proposed value led to the breakdown of negotiations.

Vedanta, under the ownership of Indian billionaire Anil Agarwal, had regained control of KCM late last year after a prolonged legal battle with the Zambian government. The Zambian government had seized the mines from Vedanta’s control, accusing the company of failing to invest in expanding copper production. This legal conflict had lasted for five years before Vedanta successfully regained control.

Currently, Vedanta is focused on exploring alternative funding options, including both debt and equity, to meet its financial needs and advance its operations. The company requires approximately $1.2 billion to settle debts, revitalize mining operations, and invest in the development of the Konkola Deep Mining Project.

A spokesperson for Vedanta confirmed the company’s ongoing commitment to seeking all viable funding solutions but declined to comment on any specific ongoing discussions or negotiations with other potential partners. The company remains dedicated to exploring all possible avenues to support its financial and operational goals.