Zambia plans to reduce its ownership in the company that holds minority stakes in the country’s mines as Africa’s biggest copper producer takes a further step back from an era of nationalization.
The southern African nation will probably cut its 87.6 percent stake in ZCCM Investment Holdings to less than 50 percent, Mines Minister Christopher Yaluma said yesterday in an interview by mobile phone from Kasama, 650 kilometers (404 miles) northeast of the capital, Lusaka. The cabinet will decide on the size of the divestment, he said.
“We are not looking back, but looking forward and getting the mining houses totally into private hands,” he said. “We have gone past nationalization and we are not going back.”
ZCCM-IH holds minority stakes in the local units of Glencore Xstrata Plc (GLEN), First Quantum (FM) Minerals Ltd. and Vedanta Resources Plc (VED), following state asset sales that began in the 1990s. Zambia’s mines lost more than $1 million a day under government ownership, according First Quantum, the country’s biggest copper producer. Output of the metal fell 65 percent to 263,000 metric tons in 1997 from 1973, chamber of mines figures show, before rebounding to more than 800,000 tons last year.
Mabvuto Chipata, ZCCM-IH’s chief financial officer, declined to comment, referring questions to Chief Executive Officer Mukela Muyunda. Muyunda couldn’t be reached on his mobile phone outside normal business hours.
ZCCM-IH plans to sell stock to existing shareholders to repay debt to the government and invest in new developments, the Lusaka-based company said last week. The state doesn’t intend to increase its ownership through the exercise, it said.
Most minority shareholders own their stock through the NYSE Euronext in Paris, according to ZCCM-IH, which estimates the company’s asset value at 2 billion kwacha ($387 million).
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