Hindustan Zinc says $2.98 billion buyout of Africa zinc assets is an ‘attractive opportunity’

The transaction, approved by the Hindustan Zinc (HZL) board on January 19, was opposed by all three government nominees on the board over several concerns

Updated - February 07, 2023 09:57 pm IST

Published - February 07, 2023 08:19 pm IST - NEW DELHI

 

Hindustan Zinc’s proposed $2.98 billion purchase of THL Zinc Ltd., Mauritius, which owns zinc mines in Namibia and South Africa, through a related party transaction is “an attractive opportunity” to grow, scale up its overseas foothold and take the brand global, the company said on Tuesday. 

Responding to stock exchanges’ call for clarifications on reports of the government opposing the transaction, the firm said: “We are not aware of any information which has not been disclosed to the stock exchanges”. 

The transaction, approved by the Hindustan Zinc (HZL) board on January 19, was opposed by all three government nominees on the board over several concerns, including valuations that would affect the Centre’s plans to offload its residual 29.5% stake in the erstwhile public sector unit that is now part of the Vedanta group. 

“HZL will have the combined reserves and resources of 1,000+ mn T of ore and 65+ mn MT of metal across India and Africa,” the company said in a filing. “Zinc assets [owned by THL Zinc] have the potential to produce 1 million MT zinc at first quartile of global cost curve and to be the largest zinc producer in Africa,” it added. 

“The company is fully complying with all the applicable rules and regulations and making timely disclosures on UPSI [unpublished price sensitive information] as required under law,” HZL said.   

HZL shares slid 2.2% on Tuesday to close at ₹331.40 on the BSE. 

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