International Resources Holding (IRH), the mining investment arm of United Arab Emirates' richest company, is among investors holding talks on buying into Vedanta Resources' Zambian copper assets, a senior Vedanta executive told Reuters.
IRH, a unit of Abu Dhabi's International Holding Company which holds about $244 billion in assets, is interested in acquiring a stake in Konkola Copper Mines (KCM) and is conducting due diligence on the assets, Chris Griffith, Vedanta's chief executive for base metals, said.
IRH did not immediately respond to emailed questions. It told Reuters in April it was interested in the KCM assets and that it was "deeply committed" to expanding its presence in copper mining.
The KCM assets have also attracted interest from other investors, Griffith told Reuters on the sidelines of a mining conference in London, declining to provide names.
Vedanta, owned by Indian billionaire Anil Agarwal, wants to sell a stake in the copper mines to raise about $1.2 billion required to revive operations and boost copper output.
Vedanta waged a five-year battle to recover the copper mines and smelter that were seized by Zambia's previous administration of former president Edgar Lungu after it accused the company of failing to invest in expanding copper production.
Vedanta could sell up to 30% of its shareholding in the Konkola assets, Griffith said. The miner owns an 80% stake in the KCM and Zambia state firm ZCCM-IH the balance.
"IRH have been in discussions with us and have been part of the data-room process," Griffith said in an interview. He said the company wanted "a little bit more than just up
to 30%", but believed negotiation was possible.
IRH offered to buy a 51% stake in the KCM assets for more than $1 billion, Reuters reported in April, citing sources. The Abu Dhabi company wants to build up its copper mining business
in Zambia after buying a 51% stake in Mopani Copper Mines in a deal worth $1.1 billion.
Griffith said other long-term investors were also exploring the potential to invest in the KCM assets.
"We've allowed that process to happen in parallel," Griffith said. "So we've advanced down the road with a number of partners already that are in that process of doing their due diligence."
Vedanta is seeking to gradually invest in increasing copper output at the Konkola mines over the next five years, Griffith said. The company is close to securing an additional $270 million it needs to pay off outstanding KCM creditors and meet
social commitments, the CEO added.
Although Vedanta wants to sell a stake in KCM, it wants to retain majority shareholding, Griffith said.
