LUSAKA, Feb 8 (Reuters) - First Quantum Minerals has asked a Zambian court to dismiss a $1.4 billion claim by a state-owned firm, which accused the Canadian company of irregular transactions with its local subsidiary.
The claim by Zambia Consolidated Copper Mines Investment Holdings (ZCCM-IH), which holds minority stakes in most of the country’s copper mines, includes $228 million in interest on $2.3 billion of loans that it said First Quantum wrongly borrowed from the Kansanshi Copper Mine, as well as 20 percent of the principal amount, or $570 million.
First Quantum said in court papers seen on Wednesday in the Lusaka high court that the action taken by ZCCM-IH was started without the approval of the state firm’s board, which was dissolved when the action commenced.
ZCCM-IH, in which the Zambian government has a 77 percent stake, said in papers filed in the Lusaka High Court on Oct. 28, 2016 that First Quantum used the money as cheap financing for its other operations.
First Quantum says the loans were at a fair market rate. (Reporting by Chris Mfula; Editing by James Macharia and David Evans)