Vedanta has called on the Government of Zambia to allow unhindered passage of its experts, employees or contractors of its former local unit in Zambia – KCM inside, into and out of the country. Konkola Copper Mines (KCM) is one of Zambia’s largest copper producers, with operations in Chingola, Chililabombwe, Kitwe and Nampundwe. KCM is a subsidiary of Vedanta Resources Limited (“Vedanta”).
Vedanta Resources Limited has challenged the decision of the Lusaka High Court to grant an ex parte order appointing a provisional liquidator for KCM following the liquidation application which was brought against KCM by ZCCM-IH.
Vedanta intends to fully defend its legal right and has called on the Government of Zambia to meet with Vedanta to come up with mutually agreeable solutions to the current situation happening at the mining firm.
In a statement availed to the Zambian Business Times – ZBT, Vedanta has expressed concerns about the intentions of the applicants and the procedures that were followed by ZCCM-IH as a representative of government to obtain a provisional liquidation order on an ex parte basis against KCM in an apparent misuse of the legal process to date.
The company is however relying on the protection of its rights under Zambian law and international norms. Some concerns in the statement indicate that ZCCM-IH is not a major creditor of KCM and that the powers granted to the provisional liquidator by the Lusaka High Court most closely resemble those that would be granted to a liquidator on the final winding up of a business.
The Zambian state-owned ZCCM-IH holds a significant shareholding (20.6%) in KCM. Since 2004, KCM claimed that they have invested more than US$3 billion to upgrade and expand company assets. Today it is of the largest private sector employer in the country and maintains one of the most comprehensive corporate social investment programs. Efforts to get a comment from ZCCM-IH proved futile with indications that the transaction is too sensitive to comment on.could not be reached.
Mines Minister, Richard Musukwa has announced that the KCM liquidation is a one off incidence with and that the government has no intention of nationalizing the mining industry. He confirmed that the government is ready to meet the Vedanta team as it operates on an open door policy.
