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Zanaco Says Zambian Government to Investigate Privatization

Zambia is investigating the partial sale in 2007 of state-owned Zambia National Commercial Bank Plc (ZANACO), according to a statement by the Lusaka-based lender.

The government of Africa’s biggest copper producer set up a commission of inquiry on Dec. 20 and this may have a “material effect” on its share price, the company, known as Zanaco, said in an e-mail distributed by Stockbrokers Zambia Ltd. today.

Zambian President Michael Sata, who was sworn into power on Sept. 23, has said he wants to “spread around” the country’s wealth. In December Zambia’s antitrust regulator said it would investigate how mining companies operating in the southern African country award contracts for the supply of goods and services. On Jan. 24 Sata dissolved the board of Zambian Telecommunications Corp., the fixed-line operator that the government took back from Libyan company LAP Green Network.

Rabobank Nederland (RABO), based in Utrecht, Netherlands, bought a 49 percent stake in Zanaco in 2007 and the Zambian lender listed on the Lusaka Stock Exchange the following year after completing an initial public offering.

Zambian Information Minister Fackson Shamenda said the investigation was a “routine inquiry” and “aimed at simply establishing that all procedure was followed when it was sold to Rabo.”

Zanaco spokeswoman Chana Musakanya said the bank will “cooperate fully” with the investigating team. “We look forward to the review of the privatization process of Zanaco, which was extensive and took place over a period of many years,” she said in an e-mailed statement today.

To contact the reporter on this story: Janice Kew in Johannesburg at jkew4@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net

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