Zambia, Africa’s second-biggest copper producer, is close to selling a stake in ZCCM Investments Holdings, a state controlled mine holding company, for more than $100 million, according to three people familiar with the matter.

Sapir Capital, an Israeli private equity company that’s invested in industries from nanotechnology to oil and gas, is waiting for final government approval for the acquisition of the 17.25 percent stake directly held by the government, said two of the people who asked not to be identified as the information has not been made public. A minority shareholder group welcomed Sapir’s investment, without giving further detail.

ZCCM-IH, which has minority stakes in the local units of companies including Vedanta Resources Plc, First Quantum Minerals Ltd. and Glencore Plc, wasn’t immediately able to comment. Including its direct stake, the government owns 77.5 percent of the Lusaka-based company, including a 60.28 percent shareholding through the Industrial Development Corp., of which President Edgar Lungu is chairman. Lungu’s spokesman wouldn’t immediately comment. The state pension fund also holds 15 percent of the company with the rest held by minority shareholders.

Failed Attempt

Zambia tried and failed to sell its direct stake in ZCCM-IH to local investors in 2015. If the deal goes ahead, Sapir will become the biggest shareholder after the government, which will retain its interest through the IDC.

The proceeds could help the government narrow its budget deficit as the state seeks an aid package from the International Monetary Fund. ZCCM-IH’s market capitalization of about 6.1 billion kwacha ($655 million) is significantly less than the value of its assets, according to some minority shareholders.

Anglo Mines Nationalized

“The investment of Sapir Capital is a show of confidence in the Zambian economy and the potential we all see in ZCCM-IH,” Philippe Bibard, a spokesman for a minority shareholder group based in France, said in an emailed statement on Monday, without providing details of the deal. “We look forward to having a good working relationship with Sapir Capital as a fellow shareholder.”

ZCCM-IH was formed to hold the government’s residual stakes in mines after they were privatized in the 1990s. The industry had been established and developed by Anglo American Plc before its nationalization in 1971.

Source: Bloomberg

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