(Reuters) – Glencore has agreed the sale of its majority stake in Mopani Copper Mines to Zambia’s mining investment arm ZCCM-IH in a $1.5 billion deal, the miner and trader said on Tuesday.
The deal is funded by borrowings from Carlisa Investments Corp – a British Virgin Islands based company through which Glencore holds its stake – and other members of the Glencore group, the company said.
Glencore said that after completion of the sale of its 73% stake it would retain offtake rights of Mopani’s copper production until the transaction debt had been repaid in full.
At a ceremony in Lusaka, ZCCM-IH Chairman Eric Silwamba said the company would acquire 90% of Mopani from Carlisa Investments Corp, bringing ZCCM-IH full control of the company. ZCCM-IH previously held 10% of Mopani.
Zambia’s mines minister Richard Musukwa said that more than 15,000 workers would have lost their jobs if the mine was closed.
The sale comes after Glencore last year tried to suspend operations at Mopani due to low copper prices and COVID-19 disruptions, angering the government, which threatened to revoke the company’s mining licences.
Glencore said it holds 81.2% of the shares in Carlisa. First Quantum Minerals, which previously held 16.9% of Mopani, did not immediately respond to a request for comment.
Reporting by Chris Mfula in Lusaka; Writing by Helen Reid in Johannesburg; Editing by Alison Williams and Louise Heavens