The South African government has increased its stake in the largest sub-Saharan aluminium smelter in Africa this week.
The Industrial Development Corporation of South Africa (IDC) exercised its pre-emptive rights earlier this week to purchase another 8.445 percent of Mozal Aluminium. IDC purchased the shares from Mitsubishi subsidiary MCA Metals Holding. The sale boosted IDC’s share of Mozal Aluminium from 24 percent to 32.45 percent.
With the sale, Mozal Aluminium becomes one of the biggest investments IDC has yet made on the African continent. IDC CEO TP Nchocho told local media that several factors motivated the purchase.
“We are pleased with this development. Mozal has provided good returns on our investment but most important for us has been the socio-economic development impact of this project on the local people.”
Nchocho went on to say that the investment dovetails with IDC’s primary goals of sustaining and increasing the economic development of the area.
“Driving sustainable industrialisation and decarbonisation of energy-intensive industries forms part of the IDC’s strategy. And our investment in Mozal aligns with this strategy.”
Mozal was founded in 1988 as a partnership among BHP Billton, Mitsubishi, and the government of Mozambique, becoming one of the country’s biggest contributors to export earnings. Seven years ago BHP Billton sold its share to South32.
Mozal Aluminium is powered largely via hydroelectricity, qualifying the Maputo plant as a green product.
Financial details of the deal were not disclosed at the time of this writing.