Armenian government plans to hold IPO for its share in  Zangezur  Copper and Molybdenum Combine

ArmInfo. The Armenian government plans to sell its 21.875% stake (1/5 of the total share)  in the Zangezur Copper and Molybdenum Combine on the stock exchange through an initial public offering ( IPO).

Prime Minister Nikol Pashinyan shared these plans at a Cabinet meeting on December 19th.   Pashinyan pointed out that last week ZMMC paid 33 billion 249 million  AMD in dividends to the state budget. <This event is worth  emphasizing, because nothing like this has happened in the country  for more than 20 years,> he said.

He also highlighted that the mentioned amount does not include the  taxes paid by the plant.  ZMMC paid 73 billion 800 million AMD in  taxes from January to November 2024. This means, the state treasury  received a total of 107 billion AMD (about $ 276 million) in taxes.   The Prime Minister noted that this figure has noticeably increased  compared to the previous year. This increase was largely due to the  growth in global metal prices. However, the fact that the RA  government became a shareholder of the enterprise also contributed  significantly to this increase.

In turn, the Minister of Territorial Administration and  Infrastructure David Khudatyan noted that the plant ended 2023 with a  net profit exceeding 294 billion AMD. Of this amount, 152 billion AMD  were distributed as dividends, with the government receiving its  share of 33.2 billion AMD. The remaining 142 billion AMD has not   been distributed yet. The head of the State Revenue Committee (SRC,)  Eduard Hakobyan, emphasized the increasing global sales of electric  vehicles, indicating a continued rise in the demand for metals in the  future.

Nevertheless, the Prime Minister emphasized the importance of the  government  utilizing its voting right  to enhance the productivity  of  ZMMC.  In this vein, Pashinyan believes that in the future, the  population of Armenia should have the opportunity to purchase shares  of the company, which will be facilitated through an open  subscription to the company's shares. <In order to achieve this, the  company needs to reach a completely different level of development  and transparency, and the government must  participate accordingly.  In other words, these 21% of shares will be made available for public  trading, allowing any individual in Armenia to  invest  their savings  in them,> he explained. In this regard, Armenian Minister of Economy  Gevorg Papoyan said that consultations with the plant's management  have shown their readiness to work in this direction. They intend to  invite a German consulting company to enhance the transparency of the  company, improve the corporate governance system, and ultimately  prepare for going public.

<Next year, in addition to the financial report, ZMMC will publish  three more reports: on sustainable development, environmental  protection and social responsibility. All reports will be audited by  Big4,> Deputy Prime Minister of Armenia Mher Grigoryan noted, adding  that Zangezur Copper Molybdenum Combine CJSC (ZMMC) is the largest  mining company in Armenia. In 2023, the company topped the list of  the country's largest taxpayers. The plant operates the Kajaran  copper-molybdenum deposit.  The plant has an ore supply that will  last for about 150 years. It  produces molybdenum and copper  concentrates, with the molybdenum concentrate containing 50%  molybdenum and the copper concentrate containing at least 15%.  According to the State Revenue Committee for January-September 2024,  the Plant remains at the top of the list of 1000 large taxpayers of  Armenia (as it was  in the previous year). During this period, the  plant increased tax payments to the state treasury by 59%, totaling  83.6 billion AMD. Of this amount, 1.7 billion was paid in customs  duties, 26.6 billion in direct taxes (including profit tax, income  tax), and over 2 billion in indirect taxes (including VAT, excise  tax). On September 30, 2021,  the Industrial Company JSC acquired 60%  of ZMMC shares and donated 25% of its share to the Armenian  government.  On March 24, 2022, the government received an additional    6.875% of shares as a gift, making them the owner of 21.875% of  shares or 1/5 of the plant's share.

It should be noted that on December 6, 2024, ZMMC presented its third  sustainable development report (ESG Report). According to Armen  Stepanyan, ZMMC Director for Sustainable Development, investments in  social infrastructure are of great importance for the enterprise. The  company focuses on subvention programs as a model in which all  stakeholders participate. According to him, in 2023, the total amount  of funds allocated for  subvention programs was approximately   300-400 million AMD. There is an increased focus on environmental and  labor safety issues. According to ZMMK information, the company's  revenue last year amounted to 796.9 million USD.