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Vedanta to Withdraw Arbitration on Hindustan Zinc; Zambia to End Vedanta Legal Tussle
May 11, 2022
Indian metals & mining giant Vedanta Ltd. will apply to withdraw the arbitration on buying the Government of India’s stake in Hindustan Zinc which was filed in 2009. Hindustan Zinc’s promotor is Vedanta, which holds 64.92% and the Government of India has a 29.5% stake. In 2021, the Supreme Court had allowed the government to disinvest its residual stake in the open market. The government plans to divest the stake in the current financial year via an offer for sale.
Separately, Zambia, one of the biggest copper producers in Africa has decided to end legal action against Vedanta Resources Ltd (VRL). Konkola Copper Mines (KCM) in 2019 was seized from VRL and placed under provisional liquidation as the previous Zambian government alleged that VRL had lied about expansion plans and tax-related issues. Current president Hakainde Hichilema seeks to revive mining output within the country and hence needs to revive relationships with mining companies to attract more investment in the sector, analysts said. Hichilema said, “Vedanta and ourselves agreed that we suspend litigation, by-and-large as a partial way of resolving the matter, The outcome I wouldn’t predict, but there will be a resolution of Konkola Copper Mines.” In December 2021, VRL said it was ready to invest about $1.5bn to revive KCM and also warned that mothballed operations are on the verge of collapse.
VRL’s dollar bonds were trading weaker with its 7.125% 2023s were down over 0.32 points to 93.56 yielding 13.93%.
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