Glencore has taken majority control of one of its mining interests in Democratic Republic of Congo, increasing its ownership of the Mutanda copper mine through two deals with privately held companies.
The commodities trader said on Tuesday that it had agreed to buy an additional 24.5 per cent of Samref Overseas, a Panama-registered holding company, from High Grade Minerals and 1 per cent in Samref Congo from Groupe Bazano, two Congolese companies, for a total of $340m in cash. Samref Congo owns 80 per cent of the Mutanda mine.
The deal means Glencore owns almost 75 per cent of Samref Overseas, or a 60 per cent indirect stake in Mutanda, and a $430m option to buy the remaining 25.5 per cent of the holding company from HGM in December 2013.
Glencore has attracted criticism from campaign groups such as Global Witness. They want more information about the trader’s acquisitions and its interests in Mutanda and the neighbouring Kansuki mine and about its partners.
Global Witness on Tuesday said that “given the corruption risks in Congo” Glencore should disclose more about its deals, including that beneficiaries “do not include Congolese government officials or their proxies”.
HGM did not feature in Glencore’s float prospectus but a person familiar with the matter said that Bazano owned the company.
Global Witness this month published a report asking why companies half-owned by Glencore in March 2011 turned down the chance to buy stakes in Mutanda and Kansuki from state-owned mining company Gécamines.
The stakes were bought by entities associated with Daniel Gertler, a mining investor. Mr Gertler paid $120m for a 20 per cent stake in Mutanda, said Global Witness. Mr Gertler declined to comment.
Glencore said that it preferred to spend on developing its projects in the country, adding it had avoided increasing its interests before Congo elections last year, fearing instability.
Tuesday’s deal gained Glencore majority control of the Mutanda mine’s holding company, but the Gécamines minority stake would not have achieved that end.
Highlighting its code of corporate practice, Glencore said: “Our position on the issues of bribery and corruption is clear: offering, paying, authorising, soliciting or accepting bribes is unacceptable to Glencore.”
Last August, Glencore said it was exploring a merger of the Kansuki and Mutanda mines and taking control of the combined entity.
Glencore has invested more than $1bn in the Mutanda mine through loans at a commercial interest rate, and has committed to development loans of $400m at the Kansuki mine.