Vedanta Resources is seeking $1 billion in debt financing for its Konkola Copper Mines in Zambia to boost copper output. The company, which owns 80% of KCM, prefers to maintain its ownership rather than pursue a stake sale. After overcoming legal challenges, Vedanta is exploring multiple financing options to enhance its financial position.
Vedanta Resources is seeking around $1 billion in debt financing to support the development of its Konkola Copper Mines (KCM) in Zambia. Chris Griffith, head of the company’s base metals unit, indicated in an interview that selling a stake in KCM has become less probable. He stated, “We are in a much higher likelihood that we can raise the funds from a range of financing options.”
The company aims to boost copper production at KCM to approximately 300,000 tonnes per annum within the next five years. Previously, Vedanta had considered selling a 30% stake in KCM, but the current preference is to retain its 80% ownership. Griffith emphasized, “We own 80% of the business and clearly we would prefer to continue owning 80% of the business.”
Griffith noted the company is investigating various options for debt financing, although specifics have not been disclosed. This move comes after Vedanta regained control of KCM following a five-year legal struggle. The Zambian government had accused Vedanta of inadequate investment in copper production expansion.
The remaining 20% of KCM is owned by the Zambian government through the state investment entity ZCCM-IH. A previous offer from the UAE-based International Resources Holding to acquire a 51% stake in KCM was retracted in July 2024 due to valuation disputes.
Since then, Vedanta has improved its financial standing by refinancing existing bonds, potentially enabling it to raise further funds through internal and external debt avenues. Griffith also mentioned that the company has recently secured short-term financing to address outstanding debts.
Vedanta Resources, a major mining company owned by Indian billionaire Anil Agarwal, has faced challenges with its copper mining operations in Zambia. After a protracted legal battle that ended in 2024, the company regained control of Konkola Copper Mines (KCM). The Zambian government holds a minority stake, and the mining industry in Zambia has faced scrutiny regarding investment and production expansion, influencing Vedanta’s financing strategies.
Vedanta’s push for $1 billion in debt financing signifies a strategic shift towards strengthening its control over Konkola Copper Mines while enhancing production capabilities. By opting against a stake sale and focusing on raising funds through various financing avenues, Vedanta aims to stabilize its operations and increase copper output significantly over the next five years.
Original Source: www.mining-technology.com
