August 14, 2019 / 6:37 PM / 2 months ago

Vedanta fails to stop KCM liquidation in meeting with Zambia's president

FILE PHOTO: Zambia's President Edgar Lungu speaks at the Nelson Mandela Peace Summit during the 73rd United Nations General Assembly in New York, U.S., September 24, 2018. REUTERS/Carlo Allegri

JOHANNESBURG (Reuters) - Zambia’s President Edgar Lungu met with the chairman of Vedanta Resources (VDAN.NS) to discuss the disputed liquidation of its Konkola Copper Mines, a statement issued by the Zambian State House said on Wednesday.

Vedanta has been locked in a dispute with the Zambian government since May when Lusaka appointed a liquidator to run KCM, which is 20% owned by Zambia’s state mining company ZCCM and the rest by Vedanta. Zambia accused KCM of breaching the terms of its licence, which Vedanta denies.

The statement said that at the request of Vedanta, the president had met with Chairman Anil Agarwal who expressed the company’s desire to continue running the asset and, among other things, pay debts owed to suppliers and contractors, reinvest in the mine and restructure its shareholding.

However, the statement said while the president agreed to listen to Agarwal’s position it did not change his mind.

“The president stated that the position the government has taken has the support of the people of Zambia, and the meeting will not affect the ongoing liquidation process,” the statement said.

Vedanta confirmed it had requested the meeting and that Agarwal had travelled to Lusaka on Wednesday.

“The meeting was constructive and Vedanta looks forward to further positive engagement,” the company said in a statement.

The dispute in Africa’s second-largest copper producer has intensified concerns among international miners about resource nationalism in Africa.

Mumbai-listed Vedanta has taken the matter to arbitration and tried to block KCM’s liquidation in the meantime via courts in both South Africa and Zambia. However, the government has continued with the process and said in July it expected numerous bids for KCM within weeks.

Reporting by Emma Rumney; Editing by Kirsten Donovan

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