Canadian miner First Quantum Minerals is in talks to sell a stake in its Zambian copper mines to Chinese state-owned Jiangxi Copper Corp, aiming to bolster the company’s finances, a person familiar with the matter told Reuters.
Details are yet to be finalized and it was not clear whether the latest talks would lead to a transaction, the person said.
The talks began last month after First Quantum suffered a major blow in Panama, where it was ordered to shut one of the world’s biggest copper mines, which debt rating agency Fitch has warned could hurt the company’s borrowing capacity.
In Zambia, First Quantum wholly owns the Sentinel mine and 80% of the Kansanshi mine, with the rest owned by the Zambian government. Jiangxi, First Quantum’s top shareholder, could end up buying one of the two mines or a stake in one of them, the person added.
“The Chinese want the Zambian mines … so the company (First Quantum) could sell one of the Zambian mines,” the source said.
The person declined to be named as they were not authorized to talk to media.
A First Quantum spokesperson declined to comment on the talks and said the company will provide an update later this month on the company’s plan to meet its debt obligations.
Some $1.05 billion of First Quantum’s debt comes up for maturity in early 2025.
Jiangxi Copper did not respond to an email query by Reuters.
The two Zambian mines together generated $943 million revenue in the quarter ending September 2023 and $210 million in operating profit, according to company filings.
Source: Reuters.com