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ZCCM-IH | Restructuring of the Balance Sheet

The market and shareholders are advised of the following new developments relating to the company.

Restructuring of the ZCCM-IH Balance Sheet

ZCCM-IH currently has significant loans mainly arising from the restructuring programs undertaken prior to and during the company’s privatisation in 2000. The majority of these loans are owed to the Government of the Republic of Zambia (“GRZ”) and continue to be carried on the books of the company. As at 31 March 2011, the ZCCM-IH Financial Statements reflected loans amounting to K2, 139 billion (approximately US$425 million) owed to the GRZ.

These loans have placed a significant burden on the company with the result that ZCCM-IH has had a weak balance sheet from 2000.

The company has been in discussions with the GRZ over these loans and recently the GRZ accepted proposals to convert all or part of the loans to equity through a rights issue transaction. The main objective, amongst others, of the proposed debt-equity conversion is to clean the ZCCM-IH balance sheet.

ZCCM-IH is currently liaising with the GRZ to agree the terms of the transaction.

ZCCM –IH shares are listed on the Lusaka Stock Exchange (LuSE) and also traded on the Paris Bourse in France.

In compliance with the Securities Act, Cap 354 of the Laws of Zambia and the Listing Rules of the LuSE, further announcements will be made to inform the shareholders and the investing public as the transaction progresses.

Accordingly, shareholders are advised to exercise caution when dealing in the company’s securities until a full announcement is made.

12 December 2012

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