Aim-listed ZCCM-Investment Holdings (ZCCM-IH) has confirmed that it has entered into an agreement with International Resources Holding (IRH), which will, through its wholly-owned subsidiary Delta Mining, acquire a 51% interest in Mopani Copper Mines (MCM) for $1.1-billion.

ZCCM-IH and IRH will form a strategic partnership at MCM.

This investment comprises of $620-million in new equity capital, up to $100-million in settlement of existing third-party letters of credit and up to $380-million of shareholder loans into MCM as a strategic equity partner (SEP), subject to the fulfilment of conditions precedent.

Consequently, upon the satisfaction of those conditions precedent, the relationship between Glencore International and MCM will be restructured.

ZCCM-IH took full control of MCM from Glencore in 2021, with a plan to find a suitable SEP to contribute to the expansion of the business and provide the necessary capital for growth.

IRH’s strategy is to invest in critical minerals in the region, across the entire mining value chain.

ZCCM-IH believes IRH’s partnership with the company and MCM represents an important strategic step towards the revitalisation of the Zambian economy, the Zambian mining industry and the continued development of the Copperbelt by enabling the long-term sustainability of MCM, the company highlights.

It avers that IRH’s investment into MCM will recapitalise its balance sheet, secure direct and indirect jobs and provide both funding and technical experience to complete MCM’s project development plan, all of which underpin MCM’s strategy to achieve its target of becoming a 200 000 t/y producer of copper cathodes in the next three years.

Beyond this, ZCCM-IH and IRH will work with MCM and the Zambian government to pursue other opportunities in the Zambian mining industry that will attract further investment into the region, the company indicates.

ZCCM-IH, in consultation with its transaction advisers, is preparing a transaction circular providing all the relevant information in respect of the transaction, including financial and technical information.

Shareholders will be able to vote on the transaction at an extraordinary general meeting to be held in the first quarter of this year.