Old Mutual in Talks for Stake in Zambian Power Plant, CEC Says

Zesco Power lines
Zesco Power lines

Zambia’s Copperbelt Energy Corp. is in talks with Old Mutual Plc, Africa’s largest insurer, to sell it a stake in a $220 million hydropower project in the country’s northwest.
“We are speaking to them and they seem to be very interested,” Hanson Sindowe, chairman of the power supplier, said in an interview on Tuesday in Lusaka, the capital of Africa’s second-largest copper producer. “They are carrying out their own due diligence.”
Copperbelt Energy, the biggest power supplier to Zambia’s mines, plans on completing financing for the Kabompo Gorge hydro-power project by the end of the year, Humphrey Mulela, who heads the unit overseeing its development, said in a separate interview. The 40-megawatt plant will help ease a power deficit that could disrupt mining operations this year, Sindowe said.
Copperbelt Energy, or CEC as it’s also known, plans to sell a 40 percent stake in Kabompo Gorge, and to fund the remaining 60 percent through debt, according to Mulela. The company has hired Standard Bank Group to arrange the debt. Copperbelt has also been talking to other potential investors on the equity stake, he said.
“There are a number of them and one of the main ones is Old Mutual,” said Mulela. “They’ve been proposing to look for other companies to come on board so that they share the risk.”
William Baldwin-Charles, a London-based spokesman for Old Mutual, didn’t immediately reply to an e-mail seeking comment.
CEC intends to complete Kabompo Gorge in 2018, Sindowe said in a speech earlier Tuesday, when the company signed an investment agreement for the project with the Zambian government.