Zambia Says Vedanta Unit Aims to Move $1.5 Billion Liability
Posté: Ven 14 Fév 2014 19:21Zambia Says Vedanta Unit Aims to Move $1.5 Billion Liability
By Matthew Hill February 14, 2014
Vedanta Resources Plc (VED)’s Konkola Copper Mines Plc unit has removed “a lot of money” from Zambia and wants the government to assume its liabilities that exceed $1.5 billion, said the nation’s Vice President Guy Scott.
KCM, as the company is known, is hiding information from the government and failing to pay creditors and service bank loans, Scott told lawmakers today in Lusaka, the capital. KCM also owes money to other mining companies for copper concentrate, he said. Joy Sata, a spokeswoman for KCM, declined to comment when contacted by phone and asked for questions to be e-mailed. She didn’t immediately respond to the e-mail.
“This is a matter of national importance,” said Scott. “It’s a matter concerned with billions and billions of dollars, tens of billions of kwacha, that we stand to lose if we don’t stand together and show that we won’t be taken for a ride.”
Zambia revoked the work permit of KCM Chief Executive Officer Kishore Kumar in November after he announced that the company planned to cut 1,529 jobs to reduce costs. KCM, which operates the deepest mine in Africa’s biggest copper producer, later apologized to Zambian President Michael Sata, who said the government would cancel the company’s license if it fired any workers.
“It seems as if they don’t mind heading to a situation where bankruptcy is entailed,” Scott said today in comments about KCM. “They would like their liabilities that they have deliberately built up to be taken on by the government.”
Tax Issues
An external spokeswoman for Vedanta declined to comment by phone from London, asking not to be named in line with company policy.
Zambia has said mining companies are avoiding paying tax, while KCM is suing the country’s revenue authority over a 3.2 billion-kwacha ($560 million) tax charge relating to export of copper cathodes.
Zambia holds a 20.6 percent stake in KCM through state-owned mining company ZCCM Investment Holdings, while Vedanta owns the remaining 79.4 percent.
To contact the reporter on this story: Matthew Hill in Lusaka at mhill58@bloomberg.net
By Matthew Hill February 14, 2014
Vedanta Resources Plc (VED)’s Konkola Copper Mines Plc unit has removed “a lot of money” from Zambia and wants the government to assume its liabilities that exceed $1.5 billion, said the nation’s Vice President Guy Scott.
KCM, as the company is known, is hiding information from the government and failing to pay creditors and service bank loans, Scott told lawmakers today in Lusaka, the capital. KCM also owes money to other mining companies for copper concentrate, he said. Joy Sata, a spokeswoman for KCM, declined to comment when contacted by phone and asked for questions to be e-mailed. She didn’t immediately respond to the e-mail.
“This is a matter of national importance,” said Scott. “It’s a matter concerned with billions and billions of dollars, tens of billions of kwacha, that we stand to lose if we don’t stand together and show that we won’t be taken for a ride.”
Zambia revoked the work permit of KCM Chief Executive Officer Kishore Kumar in November after he announced that the company planned to cut 1,529 jobs to reduce costs. KCM, which operates the deepest mine in Africa’s biggest copper producer, later apologized to Zambian President Michael Sata, who said the government would cancel the company’s license if it fired any workers.
“It seems as if they don’t mind heading to a situation where bankruptcy is entailed,” Scott said today in comments about KCM. “They would like their liabilities that they have deliberately built up to be taken on by the government.”
Tax Issues
An external spokeswoman for Vedanta declined to comment by phone from London, asking not to be named in line with company policy.
Zambia has said mining companies are avoiding paying tax, while KCM is suing the country’s revenue authority over a 3.2 billion-kwacha ($560 million) tax charge relating to export of copper cathodes.
Zambia holds a 20.6 percent stake in KCM through state-owned mining company ZCCM Investment Holdings, while Vedanta owns the remaining 79.4 percent.
To contact the reporter on this story: Matthew Hill in Lusaka at mhill58@bloomberg.net