ZAMBIA Consolidated Copper Mines-Investment Holdings (ZCCM-IH) Plc, has asked the Lusaka High Court to grant them an order to appoint Milingo Lungu of Messrs Lungu Simwanza and Company as provisional liquidator of Konkola Copper Mines PLC.
This is according to an application for ex parte order appointing provisional liquidator filed in the High Court on May 21, 2019.
According to Bloomberg, Zambia’s government filed notification of plans to take over Vedanta Resources Ltd.’s domestic copper assets, President Edgar Lungu said. The southern African nation’s Eurobond yields surged to a record high and the currency hit a 3 1/2-year low.
The move marks an escalation in tension between the government and mine owners, after Lungu last week threatened to “divorce” Vedanta and Glencore Plc, two of the biggest employers in Africa’s second-largest copper producer. Relations have been simmering after the state earlier this year increased royalties and unveiled a plan to overhaul the value-added tax system.
Lungu mainly targeted Konkola Copper Mines, Vedanta’s local unit, in a weekend visit to Zambia’s Copperbelt province, where some companies are cutting production and firing workers.
“There should be no question about our resolve to divorce, starting with KCM,” Lungu said in comments broadcast on state TV on Sunday. “We have filed that notification.”
The kwacha fell as much as 1.7% on Monday to 14.3152 against the dollar, the weakest level since November 2015, while yields on Zambia’s $1 billion of Eurobonds due 2024 rose by 19 basis points to 18.4%, the highest on record.
Konkola is yet to receive formal notification on the future of its assets in the country, it said in an emailed statement Monday.
The company said it plans to meet the government “as a matter of urgency to discuss the future of KCM and the impact that the current onerous situation is having on the company, the people of the Copperbelt and the Zambian people as a whole.”