Glencore may sell its entire 73pc stake in the Mopani Copper Mines (MCM) to Zambia’s state-led miner, ZCCM Investment Holdings (ZCCM-IH).
On Tuesday, the Zambian government indicated its interest in acquiring a majority stake of 51pc or more, through ZCCM-IH compared with its 10pc ownership at present.
According to media reports on Friday, Glencore plans to dispose of the entirety of its share in MCM, instead of converting its stake to a minority one, due to the loss of $1.14bn it wrote off from the mine in H1 2020. Glencore previously spent billions to expand the mine’s operational output. An unidentified shareholder of British miner told the media that MCM has not delivered the financial results expected from it.
MCM produced 51,275mt of copper in 2019 and Glencore’s share in the copper mine is currently valued at $514.5mn. If the deal goes through, it would benefit both parties involved as it would cut Glencore’s losses and divert MCM’s revenue to the Zambian Government.