(Updates with bank’s comments in fourth paragraph.)
Sept. 30 (Bloomberg) -- Standard Bank Group Ltd. provided a $500 million bridge loan to Konkola Copper Mines Plc, a Zambian unit of Vedanta Resources Plc.
The Johannesburg-based lender will arrange and underwrite a further $700 million term loan to fund investment, it said today in a statement. Konkola will use $500 million to refinance shareholder loans from Vedanta and $700 million to fund investments, according to the statement.
Konkola, the largest mining and metals company in Zambia, is seeking to double annual output to 400,000 tons and invest $1 billion by 2014. Vedanta, which received conditional approval from India’s government to take over Cairn India Ltd., operator of the country’s biggest onshore oilfield, is seeking to raise about $6 billion to fund the transaction.
“Standard Bank has full confidence in KCM management’s ability to drive the company’s growth towards becoming one of the world’s leading copper producers,” the bank said. “We are proud to be KCM’s, and its parent Vedanta’s, financial partner in this process.”
Vedanta is seeking $3.5 billion of bank loans, $1.5 billion in a bond sale and $1 billion from equities, Chief Financial Officer Din Dayal Jalan said on May 5. The equity funding will be raised “by primary and secondary offerings” by Konkola and Vedanta, he said.
Vedanta, which postponed an initial public offering of Konkola Copper Mines in November, may go ahead with the plan by the end of this year, Chairman Anil Agarwal said on May 5.
--Editors: Alex Devine, Stephen Cunningham
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