The Democratic Republic of Congo has approved the sale by Ivanhoe Mines Ltd. of a 49.5 percent stake in its Kamoa copper project to Zijin Mining Group Co., ending a dispute between the Canadian company and the government. Ivanhoe shares surged.
As part of the transaction Ivanhoe has agreed to increase the government’s stake in the local operating company Kamoa Copper SA to 20 percent from 5 percent, the Minister of Mines Martin Kabwelulu and Minister of Portfolio Louise Munga Mesozi said on Tuesday in a joint e-mailed statement.
The transaction, initially announced in May, was originally blocked by the government, which ordered a legal review of the sale in June, stating that it needed to complete discussions about raising its own stake in the project. Ivanhoe had previously offered to sell a 15 percent stake to Congo at market rates.
Shares in Vancouver-based Ivanhoe rose as much as 15 percent to 82 Canadian cents in Toronto and traded at 80 cents at 3:28 p.m. local time. Zijin is based in China’s Fujian Province.
Lars-Eric Johansson, Ivanhoe’s chief executive officer, didn’t immediately return a call made to his mobile phone.