London-headquartered Vedanta Resources (VRL) would look at moving Konkola Copper Mines (KCM) into Indian mining major Vedanta (VEDL) at the “right valuation”, even as it embarks on a plan to integrate all its copper businesses.
Last week, VRL, the parent company of Mumbai-listed VEDL, announced that the ownership and operational control of KCM was been returned to the company by the Zambian government.
“Going forward, my thought is that we must maximise synergies between KCM and VEDL’s refining and smelter businesses in the UAE and India. KCM can be moved from VRL to VEDL at the right valuation,” VRL Chairman Anil Agarwal said in a post on social media site X.
He added that with KCM and Sterlite Copper coming together, it will have a vertically integrated copper business that will create positive synergy not just for the two businesses but also for India’s growth. “Copper is a critical mineral for India’s energy transition. Thousands of MSMEs will come up, creating jobs and revenue,” he added.
Copper is a key metal for world’s decarbonisation. Demand is growing rapidly. In India, growth is over 20% annually. Vedanta acquired KCM in 2004 and made good profits when global copper prices were only $4,000. Now, global copper prices are around $8,500 and technologies are much superior so profitability will be much higher, he added.
“We can create a fully integrated copper vertical and eventually, a successful global copper company, like Chile’s Codelco and Mexico’s Southern Copper. We have other big projects coming up in the copper blocks that we have won in auctions and smelters in international geographies,” he said, seeking feedback and ideas from the social media users.
In 2019, KCM was placed under provisional liquidation by the former Zambian President Edgar Lungu’s administration, which accused VRL of dishonesty about expansion plans and tax payments. These had initiated a series of legal battles. According to various media reports, current President Hakainde Hichilema ended a four-year legal battle over its ownership.
VRL and Zambian government-owned ZCCM Investments Holdings have resolved their disputes KCM.
“The of KCM to VRL comes at a perfect time. It has one the largest reserves of copper and cobalt in the world, both important in energy transition,” Agarwal said in his tweet on Tuesday.