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Investee Company News

Ndola Lime’s metamorphosis to Limestone Resources as shareholder seeks recapitalization

Once upon Limestone giant in Africa’s second largest copper producer, Ndola Lime Company, has undergone drastic metamorphosis in the quest to rally back to profitability. After grappling with insolvency and financial woes amassed over close to a decade on the back of hard core debtors, the limestone producer and once pillar of Ndola is coming back to life. This follows efforts to capitalize, resuscitate and inject back operational resilience into the Copperbelt’s city.  Ndola Lime will now operate under a new name, Limestone Resources Limited – LRL fully owned by Lusaka Securities Exchange mining investment vehicle ZCCM-IH Plc.

Due to negative jaws, NLC has struggled to be a key employer and heart beat of Ndola, a position which it housed together with the likes of Indeni Oil Refinery in times when State Owned Entities – SOEs were still viable. However it is hoped that with the proposed re-strategization, the new legal entity, LRL will seek to drive limestone production as a going concern and will breathe life into the provincial capital of Zambia’s Copperbelt province.

June 10, marked the final turning point for the defunct Ndola Lime Company as a special resolution of creditors was passed to finalise restructure the Limestone producer through a scheme of arrangement plan. The scheme of arrangement provided for creation a new entity, restructure the NLC liabilities, transfer of the NLC business to the new entity, address the remuneration needs of NLC resources with smooth transition to the new entity and dissolution of NLC with or without winding up.  

The meeting established that LRL will commence operations totally free of debt under new management that will re-orient strategy and drive performance harder to profitability and viability. Limestone Resources Ltd shareholders will proceed with capitalization initiatives.

The implication of the metamorphosis is that Ndola Limes business will continue but under a new name whose management is earmarked to commence in 3Q20. 

ZCCM-IH is currently in the process of obtaining statutory and other approvals to facilitate the transition of NLC to LRL.

The processes of approvals, transfer, recruitment and recapitalization are estimated to take half a year from August 2020.

LRL has immense potential to further break into cement production following the ICBC $550million deal that ZCCM-IH signed up with Industrial Commercial Bank of China for a cement plant. Until this is completed, LRL has a readily available market for limestone in the mines.

The Kwacha Arbitrageur

Sources: https://thebusinesstelegraph.com/2020/06/15/ndola-limes-metamorphosis-to-limestone-resources-as-shareholder-seeks-recapitalization/
Investee Company News, ZCCM-IH News

ZCCM-IH’S EYES ON NDOLA LIME

ZCCM IH is currently in the process of obtaining statutory and other approvals to facilitate the transition of Ndola Lime Limited to the newly created company Limestone Resources Limited.

The proposed restructuring plan will ensure the continuation of Ndola Lime business under a different entity name Lime Resources Limited.

The move comes after ZCCM-IH was granted an order by meeting of creditors to consider and approve the scheme of arrangement.

ZCCM-IH Public Relations Manager Loisa Kakoma says the restructuring proposed in the scheme involves creating a new company, restructuring the liabilities of Ndola lime and dissolve Ndola Lime with or without winding off.

Mrs. Kakoma says the main objective of the plan are for Ndola Lime’s Successor company to commence business on a clean slate, recruit a new management and spearhead the formation of the new strategy.

She says this new approach will ensure workers welfare is taken into consideration, debt is resolved and ensure the company’s assets are secured.

Meanwhile Mrs. Kakoma said the processes of approvals, transfer, recruitment and recapitalization will take approximately six months from August 2020.

She said in a statement to ZNBC news that the achievement of the objective will enable the effective recapitalization of the business.

Source: https://www.znbc.co.zm/news/zccm-ihs-eyes-on-ndola-lime/
Investee Company News, ZCCM-IH News

ZCCM-IH denies selling off Ndola Lime

ZCCM-IH has denied reports that it has sold off Ndola Lime Company.

In a statement, ZCCM-IH Spokesperson Loisa Mbatha clarified that Ndola Lime Company has ceased to exist due to huge debts and that a new company known as Limestone Resources Limited has been created.

“Over the past 8 years Ndola Lime Company Limited (NLC) accumulated an insurmountable amount of debt, in excess of K1 billion, owed to various statutory bodies as well as private creditors, which led to the Company being technically insolvent,” Ms. Kakoma said.

“In September 2018, two (2) former employees instituted business rescue proceedings in the Lusaka High Court pursuant to the Corporate Insolvency Act No. 9 of 2017,” she said.

“By order of the Court dated 5th October 2018, the Official Receiver was appointed as Interim Business Administrator of NLC. Without the prospect of recapitalisation, the Business Rescue Administration (BRA) process would effectively result in the closure of NLC’s business and loss of jobs.”

“As such, ZCCM Investments Holdings Plc (ZCCM-IH) requested and was granted an Order to convene a meeting of creditors to consider and approve a proposed Scheme of Arrangement.”

“The restructuring proposals in the Scheme of Arrangement were to:
i. Create a New Company (NewCo);
ii. Restructure the liabilities of NLC;
iii. Transfer the assets and business of Ndola Lime to the NewCo;
iv. Retrench, pay and transfer the employees of NLC to the NewCo; and,
v. Dissolve NLC with or without winding up.”

She added, “The NewCo has been incorporated and is known as Limestone Resources Limited (LRL) 100% owned by ZCCM-IH.”

“At a Final Creditors Meeting held on the 10th June 2020, the creditors passed a special resolution to approve the Restructuring Proposals as contained in the Scheme of Arrangement.”

Ms. Kakoma said the main objectives of the restructuring plan are for NLC’s successor company, LRL, to commence operations on a clean slate, debt free, recruit a new management to spearhead the re-orientation of strategy and operations without any legacy problems associated with NLC.

“The achievement of the objectives above would enable effective recapitalisation of the business. In order to preserve jobs, a recruitment exercise for LRL will commence beginning August 2020.”

“The proposed restructuring plan ensures the continuation of NLC’s business, albeit under a different entity name – Limestone Resources Limited (LRL). This new approach and plan ensures that employee welfare is prioritised, NLC’s debt is resolved, and that NLC’s core assets are secured,” she said.

“ZCCM-IH is currently in the process of obtaining statutory and other approvals to facilitate the transition of NLC to LRL. The processes of approvals, transfer, recruitment and recapitalisation will take approximately six months from August 2020.”

She said ZCCM-IH remains committed to revamp the operations at NLC, under a new entity and brand, and the proposed restructuring plan provides practical solution to the key challenges currently faced at NLC.

Sources: https://www.lusakatimes.com/2020/06/14/zccm-ih-denies-selling-off-ndola-lime/
Industry News

AU pushes African trade deal to January 2021

The anticipated African Continental Free Trade Area (AfCFTA) might commence January 1, 2021, due to the ripple effects of COVID-19 on the initial date set for July 1st, 2020.

This was disclosed last Thursday by AfCFTA Secretary-General, Wamkele Mene during a webinar organized by the Africa CEO Forum. He also emphasized that the new date would be subject to the spread of the virus across the continent.

Mene indicated that this development can be attributed to the lockdown measures adopted by most African states, which has made traveling almost impossible at the moment.

“It is not credible for us to say that we are trading from July 1 when we know that trucks at borders are lined up 40 to 50 kilometers,” he said.

Mena hopes that African Union member countries are able to negotiate trade tariffs and other protocols under the AfCFTA within the next six months.

In a previous statement in May 2020, the African Development Bank Group said,”How we respond to this pandemic will determine, how quickly we return to the laid down plans.’’

With the announcement of this new date, it is also believed that investors will plan on a more feasible level to achieve business goals.

Furthermore, considering the fact that coronavirus is easily contactable, the postponement of the initial date might be in favor of public health, as the movement of people across different borders might trigger the wild spread of the virus.

According to a forecast by the World Health Organization (WHO), there will be a steady rise in the cases of COVID-19 until a vaccine is found.

Already the continent has about 216,775 coronavirus cases; 5,852 related deaths; 98,686 recoveries patients.

Upon implementation, the continental free-trade zone would be the largest new economic integration, since the creation of the World Trade Organization in 1994. Furthermore, the trade deal has the potential to bring together 1.3 billion people in a $3.4 trillion economic partnership.

However, the change of date for full operations might mean that the project will experience a significant setback in boosting intra-African trade by 52 percent in 2022 (according to a forecast by the United Nations Economic Commission for Africa).

 Source: https://venturesafrica.com/nigeria-ranks-highest-personnel-cost-in-the-global-petroleum-industry/
Industry News

Zambia tackles ‘deliberate’ undervaluation of mineral exports

Zambia on Wednesday said mines ministry officials will, starting next month, personally collect samples from mine sites around the country to prevent mining companies seeking to undervalue their production to pay less taxes.

The ministry said some mineral exporters deliberately submit low-grade samples to the state laboratory, causing an undervaluation of mineral exports and depriving the government of mineral royalty tax revenue.

“The loss of revenue could amount to hundreds of thousands, or even millions of dollars per export, depending on the discrepancy in mineral grade between the sample and the consignment being exported,” Barnaby Mulenga, permanent secretary at the ministry of mines, said in a statement.

The change, which takes effect on July 1, means the ministry will no longer accept samples submitted by exporters and is the latest push by Zambia’s government to squeeze more revenue from the mining sector.

Mining accounts for more than 70% of Zambia’s foreign exchange earnings, an income that has become even more critical as the Covid-19 pandemic hits the economy.

Africa’s second-largest copper producer, Zambia is also trying to diversify its revenue base by boosting its gold production, and making copper mining companies account for the gold they produce as a by-product.

Companies operating in Zambia include First Quantum Minerals, Glencore, Barrick Gold and Vedanta Resources.

None of them had any immediate comment.

Source: https://www.miningweekly.com/article/zambia-tackles-deliberate-undervaluation-of-mineral-exports-2020-06-10/rep_id:3650
Annual Report Summaries, Investee Companies

CNMC Luanshya Copper Mines Plc (CLM) Extract from 2020 Annual Report

CLM increased its production volumes in 2020 with total copper output of 55,976 tonnes, up from 55,000 tonnes in 2019. This was due to increased mining activities and increased slag reclamation at Muliashi and Baluba.  

During the year, revenue increased to ZMW6,435.79 million (US$345.45 million) from ZMW2,992.91 million (U$S 224.67 million) as at December 2019 with net profit increasing to ZMW784.97 million (US$42.13 million) from ZMW 274.91 million (US$20.64 million).  

In the quarter under review, ZCCM-IH signed a loan facility with CLM. With a positive equity position, the company shall continue to explore the possibility of dividend payments in 2021 so as to reduce this loan amount.  

No dividends were declared during the year (31 December 2019: nil).
Archived Tenders, ZCCM-IH

REQUEST FOR EXPRESSIONS OF INTEREST (EOI) TO UPDATE THE 2017 BUSINESS CASE REVIEW FOR CENTRAL AFRICAN CEMENT – TENDER NO.: ZCCM-IH/060/2020

INTRODUCTION
ZCCM Investments Holdings PLC (“ZCCM-IH” or “the Company”) is an investments holdings company primarily holding key minority interests across the mining industry in Zambia. ZCCM-IH also has significant investments in diversified energy entities through strategic minority interests in Copperbelt Energy Corporation PLC (“CEC”). CEC is a power distribution and generation company that supplies power to all the major mines in Zambia and is listed on the Lusaka Securities Exchange. The Company also has shares in Maamba Collieries Limited, the largest producer of coal in Zambia which operates a 300 megawatts thermal power plant. The Company also has investments and exposure in financial services and the real estate sector.

ZCCM-IH has a primary listing on the Lusaka Securities Exchange (“LuSE”), and secondary listings on the Paris, Euronext and London Stock Exchange (“LSE”).

2. BACKGROUND
In 2017, the 2014 Central African Cement Company Limited (CAC) Business Case of the Cement Project (“Business Case”) located in the Maisiti District, Ndola, was reviewed and updated. The review process confirmed the viability of the Cement Project and hence the Cement Project proceeded. Given the delay (arising from meeting statutory requirements) in the commencement of construction of the CAC cement plant, there is a requirement that the CAC 2017 Business Case be reviewed yet again.

Therefore, it has now become critical to review the viability of the Cement Project including its concept as the competition from other cement producers is expected to have risen and market dynamics changed since the last Business Case review. The review and investigation shall include the material changes to the following factors such as pricing, demand, forex impact on the production cost and final pricing, statutory approvals and their validity and market absorption rate of cement.

3. OBJECTIVE OF THE ASSIGNMENT
The main objective of this assignment is to conduct a detailed review of and update the market study and commercial feasibility for the CAC Cement Project. This will involve reviewing and assessing the commercial viability of the project from market, strategic and competitive perspectives within Zambia and the region. The information generated from the market study may be used in the commercial feasibility. The consultant shall also be required to upgrade the Thermal Power Plant size from the 50MW to 200MW. This should be a standalone supplementary report. ZCCM-IH now wishes to engage a Consulting firm to update the 2017 Business Case Review for Central African Cement.

ZCCM-IH now invites eligible consultants to indicate their interest in providing the above services. Interested firms must provide information to demonstrate that they are qualified to perform the services (brochures, description of similar assignments, experience in similar conditions etc.) Interested consultants may obtain further information at the address below during office hours between 08:00 – 13:00 hours and between 14:00 – 17:00 hours local time from Monday to Friday. A consultant will be selected using Quality Based Selection (QBS) method. Interested consultants must submit one (01) original and three (03) hard copies of the Expression of Interest (EOIs) to the address below no later than Tuesday, 16 th June 2020.

Procurement Manager
ZCCM Investments Holdings Plc
ZCCM-IH Office Park
Stand No. 16806, Alick Nkhata Road
Mass Media Complex Area
P.O. Box 30048
Lusaka.
Email: kabwek@zccmnew.wpenginepowered.com

Download the full document here: REQUEST FOR EOI TO UPDATE THE 2017 BUSINESS CASE REVIEW FOR CENTRAL AFRICAN CEMENT- Final
ZCCM-IH News

GOLD COOPERATIVES EXCITED

GOLD Mining Cooperatives in Rufunsa are excited by President Edgar Lungu’s pronouncement that they will receive equipment and sales will be liberalised. The cooperatives have also requested to mine in the national parks where there is more gold. They have vowed that they will not allow foreigners to “steal” their God given resource. And President Edgar Lungu’s pronouncement that gold cooperatives be allowed to deal with any genuine buyers and not only ZCCM-IH have elated the artisanal miners. Rufunsa’s Chimwetu Gold Mining Cooperative Chairman, Emmanuel Tembo said the pronouncement was an indication that Government was serious with uplifting lives of Zambians.

What Emmanuel Tembo said…

“We are also elated to note that our two cooperatives, Chimwetu and Pokela will each receive their own equipment soon. This will help promote self-sufficiency in each group especially that we now have a wider market,” said Mr Tembo.

He however appealed to government to allow them go further and mine the deposits in the national park. Mr Tembo disclosed that during his recent visit to Rufunsa, President Lungu said assured the cooperatives that they were not restricted to only deal with ZCCM-IH. He said the Presidential assurance excited all cooperatives who initially thought that ZCCM-IH would monopolise the business in the area. Mr Tembo said that if the cooperatives were allowed to sell the gold to the best buyer then this would enable them to make favorable bargains. According to him, allowing for the market forces to determine the price of the commodity would enable the cooperatives to gain real value for the commodity. Mr Tembo also said the assurance by the President on the handover of the gold mining equipment was exciting. He however appealed to government to ensure that foreigners were removed from Rufunsa, saying that they were depriving the locals of their God-given wealth. “We are also elated to note that our two cooperatives, Chimwetu and Pokela will each receive their own equipment soon. This will help to promote self-sufficiency in each group especially that we now have a wider market,” said Mr Tembo. And Senior Headman Nyampande, John Mamba has requested the Ministry of Mines and Mineral Development and ZCCM-IH to give a clear roadmap regarding the formation of cooperatives for gold hosting communities to be engaged in the mining of the resource,. Bishop Mambo said Zambians were yearning to form cooperatives but were not guided on how it should be done. He said in an interview yesterday, it was important for the ministry and the relevant authorities mandated to oversee gold mining to give a clear picture on how the communities can be engaged in the mining of the resource. Bishop Mambo said only few cooperatives had been formed in the area because the communities had no proper information of how they could obtain the legal documents for them to start mining. Meanwhile Senior Headman Nyampande said it was unfortunate that he was not even approached by ZCCM-IH when it was putting the gold processing plant in his area. “How can the local people be employed if the ZCCM-IH has put a processing plant in my area and they have not approached me,” he said.

Source: https://www.pressreader.com/zambia/daily-nation-newspaper/20200609/281479278648754
Archived Tenders, ZCCM-IH

Tender No.: ZCCM-IH/044/2020 for the Supply and Delivery of a 30 Tonne Dump Truck, an Articulated Excavator

  1. Tender : ZCCM-IH/044/2020 for the Supply and Delivery of a 30 Tonne Dump Truck, an Articulated Excavator, a 2.5 Tonne Folk Lift and a 20Tonne Containerized Truck for Mining Operations at Kasenseli Gold Mine in Mwinilunga District:
  2. Tender : ZCCM-IH/046/2020 for the Hire of a 30 Tonne Dump Truck, an Articulated Excavator, a 2.5 Tonne Folk Lift and a 20Tonne Containerized Truck for Mining Operations at Kasenseli Gold Mine in Mwinilunga District:

Reference is made to the above mentioned tenders.

This serves to inform all Prospective Bidders in these tender that Addendum No.1 has been issued for the above mentioned tenders in response to the queries received and additional information that has become available.

Bidders are therefore, requested to collect the addendum for tender clarification from the ZCCM-IH Procurement Department at the address indicated below, starting from Monday 1st June 2020.

All other conditions and contents of the bidding documents including the tender closing dates remain unchanged.

Procurement Manager
ZCCM-IH Office Park,
Stand No. 16806, Alick Nkhata Road,
Mass Media Area
Tel: +260-211-388000

E-mail: kabwek@zccmnew.wpenginepowered.com

Download the full document here: Addendum No. 1 – Supply Delivery of a 30Ton Dump Truck – 28.05.2020 – Advert (1)
Archived Tenders

Diamond Drilling Works in 2 Licence Areas ONB No.: ZCCM-IH/056/2020

  1. 1. ZCCM Investments Holdings Plc. has received financing from own sources toward the CAPEX for the 2018/2019 Financial Year, and it intends to apply part of the proceeds of this financing to payments under the Contract for the Drilling Works in 2 Licence Areas; Contract No.: ZCCM-IH/056/2020.
  2.  ZCCM Investments Holdings Plc now invites sealed bids from eligible and qualified bidders for the Drilling Works in 2 Licence Areas as follows:
    Lot 1 – Kabundi Area in Serenje District (Duration – 20 weeks); and
    Lot 2 – Ndola Area Covering Ndola Lime (Duration – 10 weeks);
  3. Bidding will be conducted through the Open National Bidding (ONB) procedures specified in the Public Procurement Act of 2008 and the Public Procurement Regulations of 2011 and is open to all bidders from Eligible Source Countries as defined in the Bidding Documents. The following CEEC preferential treatment shall be applied as part of the evaluation
    3.1 Citizen-influenced company – 4%
    3.2 Citizen-empowered company – 8%
    3.3 Citizen-owned company – 12%
  4. 4. Interested eligible bidders may obtain further information from the address below and inspect the Bidding Documents at this address from 08:00 – 13:00 and 14:00 – 17:00 local time, Monday to Friday inclusive.
  5. 5. Qualifications requirements include:
    i) Experience as a prime contractor in the rehabilitation of at least two (02) contracts of a similar nature and scope in the last five (05) years;
    ii) A minimum amount of liquid assets and/or credit facilities as follows:
    Lot 1 – ZMW2, 040,000.00; and
    Lot 2 – ZMW1, 021,388.00.
    iii) Average Annual Turnover for the past three (03) years as follows:
    Lot 1 – ZMW26, 520,000.00; and
    Lot 2 – ZMW13, 278,054.00.
  6. 6. A complete set of Bidding Documents in English may be purchased by interested bidders ON THE SUBMISSION OF A WRITTEN APPLICATION to the address below and upon payment of a non-refundable fee of Zambian Kwacha Five Hundred (ZMW500.00). The method of payment will be either by Cash or Bank Certified Cheque.
  7. The address referred to above is:
    K D Kabwe (Mrs.)
    ZCCM Investments Holdings Plc.
    ZCCM-IH Office Park, Stand No. 16806
    Alick Nkhata Road, Mass Media Complex Area
    Lusaka, Zambia
    Tel: +260-211-388000
    E-mail: kabwek@zccmnew.wpenginepowered.com
  8.  Bids must be delivered to the address below at or before 10:00 hours on Friday, 26th June 2020. Electronic bidding shall not be permitted. Late bids will be rejected. Bids will be opened physically in the presence of the bidders’ representatives who choose to attend in person at the address below immediately after 10:00 hours on 26th June 2020. All bids must be accompanied by a Bid Securing Declaration.
  9. There will be mandatory site visits and pre-bid conferences as follows:
    Lot 1 – Kabundi Area in Serenje District on Wednesday, 10th June 2020 at 10:00 hours. Bidders to meet at Serenje District Council Offices at 09:30 hours.
    Lot 2 – Ndola Area in Ndola on Friday, 12th June 2020 at 15:00 hours. Bidders to meet at ZCCM-IH Mining Industry Archives along Arusha Street in Ndola at 14:30 hours.
  10. The address referred to in clause 8 is:
    K D Kabwe (Mrs.)
    ZCCM Investments Holdings Plc.
    ZCCM-IH Office Park, Stand No. 16806
    Alick Nkhata Road, Mass Media Complex Area
    Lusaka, Zambia
    Tel: +260-211-388000
    E-mail: kabwek@zccmnew.wpenginepowered.com

Download the full document here: Invitation for Bids – Diamond Drilling Works in Kabundi and Ndola (Masaiti) (2020)