Sign in Subscribe
Mining industry

Nava Bharat Ventures Acquires 65% Stake in Maamba Collieries Ltd for $26 Million

Strategic Insights

— 1 min read

Nava Bharat Ventures, a subsidiary of Nava Bharat Ventures Ltd, has signed a share sale and purchase agreement (SPA) with the Zambian government through the minister of finance and Zambia Consolidated Copper Mines Investments Holding Plc (ZCCM-IH) for acquiring a 65% stake in Maamba Collieries Ltd (MCL). This acquisition entails an initial cost of approximately $26 million, which will be paid upon completion. The acquisition is part of a global tender issued by ZCCM in late 2008 for inducting a private majority partner. The deal is expected to be completed by February 2010.

Key Takeaways:

  • Nava Bharat Ventures will acquire a 65% stake in Maamba Collieries Ltd (MCL) through a share sale and purchase agreement (SPA).
  • The initial cost of acquisition is approximately $26 million, which will be paid upon completion.
  • The acquisition is part of a global tender issued by ZCCM in late 2008 for inducting a private majority partner.
  • ZCCM Investments Holdings Plc (ZCCM-IH) was formed by the government of Zambia in 2008 to manage the country's copper mining sector.
  • The Maamba coal mine, which supplies coal to Mopani copper mines and Konkola copper mines, is under the control of ZCCM-IH.
  • The SPA sets out certain conditions precedent for completion of the transaction, including a bankable power purchase agreement and an investment promotion and protection agreement.
  • A completion audit will be conducted to ascertain the final purchase consideration by netting the liabilities of MCL and tax assets.

Statistics:

  • $26 million: Initial cost of acquisition by Nava Bharat Ventures for a 65% stake in Maamba Collieries Ltd.
  • 100%: Stake transfer by the government of Zambia to ZCCM-IH in January 2008.
  • 2008: Year in which the government of Zambia transferred its stake in MCL to ZCCM-IH and issued a global tender for inducting a private majority partner.
  • 2010: Expected completion date of the acquisition.

Sources:

  • The Indian Express Limited (2009), distributed by Contify.com.

Read more