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LUSAKA - ZCCM Investments Holdings Plc (LUSE:ZCCM-IH), a Zambian investment company, is currently involved in confidential arbitration proceedings with commodity trading firm Trafigura Pte Limited. The dispute arises from a guarantee agreement signed in 2021, with ZCCM-IH contesting Trafigura’s claims.
The guarantee in question was signed by the then CEO of ZCCM-IH on July 28, 2021, as security for a ZMW1,663 million (approximately US$100 million) prepayment to Konkola Copper Mines Plc, a company in which ZCCM-IH holds a stake. Trafigura initiated the arbitration process under the London Court of International Arbitration Rules 2020 on February 24, 2024, following a payment demand it made on November 21, 2023.
ZCCM-IH has advised its shareholders and the investing public to exercise caution when dealing with the company’s securities until further information is released. The outcome of the arbitration could potentially impact the company’s share price due to the sensitive nature of the proceedings. Shareholders and investors have been recommended to seek independent professional advice regarding the matter.
The announcement, issued on Monday by Charles Mjumphi, the Company Secretary of ZCCM-IH, reaffirms the company’s position to robustly contest the claims made by Trafigura. Updates will be provided as the case progresses, ensuring transparency for shareholders and the market.
This ongoing legal matter highlights the complexities of financial agreements and the risks associated with guarantees in international trade and investment. The Lusaka Securities Exchange and the Securities and Exchange Commission of Zambia have approved the announcement, underscoring its significance for the financial community.
The details of this announcement are based on a press release statement issued by ZCCM-IH. The company has not disclosed any further specifics of the arbitration proceedings, reiterating their confidential nature.
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