Abu Dhabi Firm Eyes Acquisition of Zambia’s Lubambe Copper Mine, Complicating Sale Process

In a development that could complicate ongoing negotiations, an entity of Abu Dhabi’s International Holding Company (IHC) has expressed interest in acquiring Zambia’s Lubambe copper mine.

This interest, communicated to EMR Capital, comes amidst the sale process initiated by China’s JCHX Mining, according to sources familiar with the matter.

International Resources Holding (IRH), a subsidiary of IHC, has thrown its hat into the ring, expressing interest in acquiring Lubambe, currently held by EMR Capital, a private equity manager.

This development adds a layer of complexity to the sale process initiated by JCHX Mining, which entered into an agreement with EMR to acquire its 80% stake in Lubambe in January.

However, the completion of the sale process hinges on approval from the Zambian government, a step that remains pending and uncertain.

Notably, the Zambian government retains a 20% stake in Lubambe through its state-owned entity, ZCCM-IH.

IRH’s interest underscores the aggressive pursuit of critical metal supplies in Africa by cash-rich oil majors from the Middle East, aiming to diversify their economies amid the global energy transition.

This interest puts Middle Eastern investors in direct competition with Chinese companies, including state-backed firms, also vying for strategic deals in Africa to fortify China’s dominance in crucial minerals, essential for various industries, including electric vehicle manufacturing.

Although EMR Capital has a binding agreement with JCHX, precluding it from considering new offers, it is aware of IRH’s interest in acquiring the assets.

IRH has informed both the Zambian government and ZCCM-IH of its intentions, although it has yet to present a formal offer to EMR.

This move by IRH echoes its recent acquisition of a majority stake in Zambia’s Mopani Copper Mines, marking its entry into Africa’s second-largest copper producer.

EMR’s decision to divest its stake in Lubambe is driven by the maturity of its funds, compounded by delays caused by the COVID-19 pandemic in the project’s development. Additionally, EMR recently sold a majority stake in the adjacent Mingomba copper project to California-based startup KoBold Metals.

Additional source: Copperbeltkatangamining