By Bwalya Mangani
When the Zambian government seized Konkola Copper Mines (KCM) in 2019, its parent company, Vedanta Resources Limited, deployed every tactic imaginable to reclaim the Chingola-based asset.
From pursuing legal action in the courts to launching an aggressive public relations, no, deception, campaign even resorting to implicit threats against the government, Vedanta stopped at nothing to regain control of KCM.
Admittedly, KCM was legally Vedanta’s property, and its abrupt takeover in 2019 was illegal and haphazardly executed.
However, KCM’s history of antagonism towards its suppliers, particularly around the settlement of debt, marked by court battles, is an undeniable reality.
In a bid to restore confidence, KCM made bold promises prior to its reinstatement.
The company pledged a massive $1 billion capital investment for mine development and infrastructure to boost integrated production.
It also committed to settling outstanding payments to suppliers, particularly small-scale vendors, with a $220 million promised.
The image KCM painted was one of financial strength and renewed commitment.
They claimed they only needed the mine back to unleash their ambitious plans.
The reality, however, tells a different story. The company’s financial strength is questionable, as evidenced not only by their seeking funding from other sources but also by the longstanding unresolved debts to creditors.
Delays in making payments to suppliers, which can be traced as far back as 2013, are not a new trend at KCM—perhaps a culture?
On Monday, March 17, 2025, the Lusaka High Court directed the Sheriff of Zambia to seize goods and chattels belonging to KCM to recover over K338 million owed to Copperbelt Energy Corporation PLC (CEC).
Yesterday, bailiffs were at KCM premises, seizing whatever goods they could lay their hands on for failure to honour the court’s order to pay CEC US$11,843,871.45 by December 12, 2024.
KCM’s has failed to make a partial payment of the $29.6 million debt owed to CEC within the 10 days ordered by the court in its December 2, 2024, ruling in respect of the Schemes of Arrangement.
Although KCM obtained a stay after the goods had already been seized, that action by the bailiffs followed the company’s failure not only to make a partial payment to CEC but also to adhere to the judgments of the courts.
The High Court ruling clearly stated that KCM’s June 28, 2024, scheme approval remains legally binding despite an appeal to the Court of Appeal by some creditors, including CEC.
Judge Charles Kafunda clarified that the right to appeal does not negate an affected creditor’s entitlement to receive payments as outlined in the scheme.
He also dismissed KCM’s argument that making payments would render the appeal redundant, stating that the Deed of Release and Waiver does not prevent creditors from exercising their constitutional right to appeal.
“The affected creditor is entitled to enjoy the fruits of the ruling of the court,” Judge Kafunda stated, reinforcing CEC’s right to payment.
The question then begs: why is KCM refusing to accept the judgment of the courts, and what does their litigious response to the payment of debt imply for current and future suppliers? Why is KCM refusing to obey the courts? Are these delaying tactics over money they do not have?
How do we prove that KCM really deposited $225 million into an Escrow account to settle its supplier debt? Why stay judgements if the money has been set aside? Who is KCM paying?
KCM assured the nation, indeed the world, that payments would be made by August 20, 2024.
That deadline has come and gone, and some suppliers remain unpaid. The optimism that accompanied Vedanta’s return has quickly faded, replaced by growing concerns over its business integrity.
On the Copperbelt, mining suppliers are the lifeblood of local economies, and critical companies like CEC play a pivotal role in sustaining operations.
KCM’s failure to honor its financial obligations threatens not just businesses but also livelihoods.
The best way for KCM to earn its stay would be to keep business out of court, an olive branch that was granted to them on their return.
The Zambian government must take a more active role in ensuring that investors meet their obligations to their stakeholders and society as a whole and insist on investors earning a solid social license to operate to avoid the déjà vu we are seeing at KCM.
The consequences of inaction could extend beyond corporate boardrooms, impacting the very communities that depend on the mine for economic survival.
