KCM Pays CEC Under Court-Approved Scheme of Arrangement
Konkola Copper Mines Plc (KCM) has confirmed payment to Copperbelt Energy Corporation (CEC) as a Class II creditor, in line with the High Court of Zambia’s approved Scheme of Arrangement (CSA). The payment follows CEC’s formal recognition of its classification under the scheme, marking a major development in a previously disputed creditor status.
KCM stated that the payment aligns with its unwavering commitment to comply with the provisions of the Corporate Insolvency Act, 2017, and to equitably settle outstanding creditor claims. CEC, who had initially contested both its classification and the court-approved scheme, has now formally accepted its status as a Class II creditor, enabling the payment.
Under the CSA, Class I creditors—those owed less than US$1 million—have been paid in full. Class II creditors, owed more than US$1 million, have received a first tranche amounting to 35% of their total claims on a pro-rata basis. KCM clarified that further payments to Class II creditors will depend on improved cash flow.
Despite challenging its classification and appealing the High Court’s ruling, CEC simultaneously sought payment through the same scheme. Legal advice provided to KCM underscored that all creditors are bound by the court ruling and that discriminatory treatment within creditor classes is prohibited.
Notably, on 18 March 2025, CEC took enforcement action against KCM assets in what KCM described as a move to “create disruption” across its operations and the Copperbelt region. The Court of Appeal, however, intervened and suspended further enforcement, ordering the return of assets pending the resolution of CEC’s appeal.
“This marks the first time CEC has acknowledged its classification and agreed to payment under the terms of the Scheme,” KCM noted, following the 14 April 2025 payment.
KCM emphasized its intention to continue asserting its legal rights, including opposing CEC’s appeal to be treated as a preferential creditor. The company reiterated its dedication to maintaining operational stability and equitable treatment of all creditors.
The CSA stems from a 28 June 2024 ruling by the Honourable Judge Kafunda, who approved a debt restructuring plan backed by 99% of KCM’s creditors. Vedanta Resources, KCM’s major shareholder, has committed US$250 million to fund the scheme—paying Class I creditors in full and partially settling Class II debts.
KCM, which operates across Chingola, Chililabombwe, Kitwe, and Nampundwe, continues its recovery journey with plans to ramp up production to 300,000 tonnes of copper per year by 2030, backed by Vedanta’s pledged investment of over US$1 billion.
