Africa-Press – Zambia. Mopani Copper Mines (MCM) has submitted to Constitutional Court that Delta Mining Limited’s acquisition of 51 percent did not require approval of Parliament as the shares traded were not an asset of the government but that of an incorporated public limited company.
Former Patriotic Front (PF) president Miles Sampa has petitioned the State to the Constitution Court, demanding the nullification the acquisition of 51% of Mopani Copper Mines by Delta Mining Limited, a subsidiary of International Resources Holding (IRH).
Sampa, a Matero MP alleges that Minister of Mines and Minerals Development breached article 210 of the Constitution of Zambia as amendment in 2016 by not subjecting Delta Mining Limited and Mopani transaction to Parliament for approval.
Article 210 of the Amended Constitution of Zambia Act No.2 of 2016 provides that… “A major State asset shall be sold, transferred or otherwise disposed of, as prescribed, subject to the approval of the National Assembly signified by a vote of at least two-thirds of the Members of Parliament.”
But according to MCM external legal counsel, Joseph Ilunga of Ilunga & Company, Delta Mining only acquired part of the Mopani shares incorporated in 2000 when the mining giant was created as a Public Limited Company following Zambia’s privatization process.
Ilunga submitted that the Delta/MCM transaction satisfied provisions of the Zambian Law according to the Companies Act which governs the process of transferring shares in Public Limited Companies.
MCM has held two Large Scale Mining in Kitwe and Mufulira since 2000, and the two licences that were due to expire on 30 March 2025 have been renewed and remain valid until 2050 all in the name of MCM.
“…the Transaction did not result in sell, transfer or disposal of any shares in MCM owned by the Government of the Republic of Zambia or indeed ZCCM IH. These 6,900,000 shares are still owned by ZCCM IH and have never been sold, nor transferred nor otherwise disposed of, in order to invoke the provisions of Article 210 of the Constitution. In line with section 147 of the Companies Act as read together with the Articles of Association, MCM was within its right to issue new shares to Delta in as deemed appropriate by the Board. The transaction in the case in CASU was purely governed by the principles of company law and those principles/requirements were followed to the letter at every stage. Moreover, Section 147 of the Companies Act has never been held to be inconsistent with the Constitution by this Honourable Court,” Mopani submitted.
At incorporation, the total Authorised Share Capital of MCM was divided into two hundred million and one shares (200,000,001), “which remains the same to date.”
Of the 200,000,001 shares, 6, 210,000 shares were issued to the previous majority-shareholders, Glencore (through its wholly-owned Carlisa Investment) while 690,000 shares to ZCCM-IH.
“As at 25 August 2023 the nominal capital of MCM stood at US $200,000,001 consisting of a total of 200,000,001 shares with a par value of US $1 each – 200,000,000 being ordinary and 1 share classified as special. Further, out of 200,000,000 ordinary shares of the Company, 6,900,000 shares were held by ZCCM IH and the status quo remains the same to date. In March 2024, after obtaining all required Company approvals, MCM 7,181,633 (seven million one hundred one thousand six hundred and thirty-three) new shares to Delta Mining Limited after successful share subscription following negotiations and completion of a commercial agreement among ZCCM IH, MCM and Delta,” MCM submitted.
A total of 185,918,367 shares of the Company remained un-issued.
“THE CORRECT POSITION IS THAT DELTA NOW HOLDS 51% OF THE TOTAL ISSUED SHARE CAPITAL OF MCM WHICH CURRENTLY IS AT 14,081,634 SHARES,” ILUNGA ARGUED.
In 2024, Delta Mining Limited, United Arab Emirates’ IRH was selected as new strategic equity investor in MCM, to take up a 51% stake in return for a US $1.1 billion capital injection as part of the process to restructure (pay-off) a US $1.5 billion debt owed by Mopani Copper Mines to Glencore, the previous majority shareholders which announced it was exiting Mopani in 2020.
“…as a Public Limited Company, it is conventional, lawful and standard business practice to invite any person to subscribe to shares of the company as a way of raising finances once a decision has been made by the Board of Directors,” Mopani submitted.
“It is a notorious fact that inviting members of the public to buy shares is a preserve and characteristic of Public Limited Companies…in the premises it is contended that there was no necessity for Parliamentary oversight nor approval in the issue of new shares to the Delta Mining Company,” Mopani submitted.
For More News And Analysis About Zambia Follow Africa-Press
