Mahtani Linked to Controversial KCM Sale to Vedanta

When an activist group recently released a secret video of the billionaire Vedanta Resources Plc founder Anil Agarwal boasting before of conference of having swindled Zambians out of the invaluable Konkola Copper Mine (KCM) for a mere $25 million, an explosion of public anger followed, including urgent calls for state action to correct the injustice.

But following an extensive investigative report, sources have revealed that Agarwal may not be the only Indian businessman who will come under fire for the flawed transaction, as the embattled Finance Bank Chairman Rajan Mahtani has also been linked to the KCM scandal from its very beginning.

The Mahtani-Agarwal Friendship

Back in 2002, President Levy Mwanawasa faced an existential crisis. After only two years, the country’s then-largest foreign investor, Anglo-American Corporation, decided to pull out of KCM citing “feasibility issues” and reduced its shareholding from 65% to 28%. With thousands of jobs on the line and a major hole in the state revenue, President Mwanawasa began desperately searching for a new investor.

The president was then approached by his former client, Mahtani, who during this period of the presidency (before they had fallen out) was known as a “kingmaker” for arranging deals with the government. Through his ties in London, he had befriended Mr Agarwal and proceeded to make introductions and set up the first meetings between the Indian owner of Vedanta and President Mwanawasa paving the way forward for the extraordinarily questionable sale of KCM for $25 million to his colleague when company assets held an estimated value of well over $350 million.

It wasn’t the first time the Finance Bank founder was involved in a shady mining deal. In 1997, Mahtani helped to broker the deal for another Indian foreign investor – the Binani Group of Companies – to acquire the troubled Luanshya mine (also know as Roan Antelope Mining Company, or RAMCOZ) for a steeply discounted price along with promises of heavy capital investment and development.

As is well known to people in the area, Mahtani’s arranged sale of RAMCOZ to Binani turned out to be a catastrophe. As soon as the assets were taken over by the Indian foreign investors, the Luanshya smelter was switched off and scrapped, while all major components were stripped and exported to other countries. Not long afterward, the Binani group shut down the Ndola copper refinery, turning the once thriving area into a ghost town. The government watched helplessly as the investors, who were paying for the assets on a delayed schedule, tore the company apart, failing to pay salaries, and causing riots among workers. After RAMCOZ was placed into receivership and audited by Grant Thornton, the company had created a $20 million debt with ZESCO, all with the help and close cooperation of Mahtani.

Controversy among Indian Community

Despite working closely to help enrich Agarwal and Binani Group in these deals, Mahtani has a much more controversial history among Zambia’s Indian business community, where many people have fallen victim to the combined power of his political ties and majority ownership of Finance Bank (which is illegal under Zambian banking code).

Investigations have further revealed that one particular couple who fell afoul of Mahtani back in 1999, Mr. Ajesh Patel and his wife Abba Patel, nearly lost their entire company to Mahtani. At the time, when Abba Patel was serving as Mahtani’s legal counsel in Ndola, the two allegedly began a love affair, according to local sources. As the relationship developed, Abba managed to convince Mahtani to provide financing for her husband’s multi-million dollar juice and Coca-Cola bottling plant in Ndola, Invesco Ltd.

Sources say that soon after Mahtani had arranged the funding for the bottling plant, the husband discovered the affair between his wife and the financier, and confronted him, creating bad blood between the two. To take revenge for this embarrassment, sources say that Mahtani demanded a full repayment of the entire loan within 30 days, a common method he has used to seize other assets numerous times since. Luckily, the cuckolded Mr Patel was able to secure refinancing from the Development Bank of Zambia (DBZ) to save Invesco Ltd., and has since turned it into an admired, successful company. The Patels took Mahtani to court over the damages he caused to the company and prevailed with a favourable judgment.

Questions Continue to Surround Mahtani-Agarwal

The situation at KCM under Vedanta is clearly not the same kind of asset stripping that Mahtani was involved in at RAMCOZ or the rough business with the Patel family. In fact, according to the company’s crisis control CEO Tom Albanese, the company has allegedly made $2.9 billion of capital investment and taken out just $73 million in dividend payments (which differs from Agarwal’s claims in the video).

But the existence of Mahtani’s fingerprints on this deal, especially in light of the Finance Bank scandals and other issues before the courts, are certain to raise more questions about the transparency of the KCM transaction back in 2004.


  1. Bemba Bimbo

    This crook must be put in jail and kept there until he arranges to bring back the BILLIONS that he has stolen from Zambia.

    He has duped every President since Kaunda, and for sure Sata was the easiest of them all!

  2. Ola

    This criminal must be locked up. I wonder why it is taking so long to keep him where he belongs- behind metal bars at Chimbokaila Prison.

  3. The Citizen

    These are businessmen. Its us to blame for being so docile, lazy, waiting for other people to develop the country. We should take all the blame for not participating in the economy of this country. GOD will punish us for being so lazy and giving away the country to the foreigner. I not pround to be a Zambia for once in my life time. Shame on us!!! Stop complaining and do something.

  4. musonda

    Let the indian trickster mock us 4being stupid!!!!!

  5. Mrs. Parekh

    Abha Patel was legal counsel for group companies and her before beyond the hours relationship came to light and Abha threw Mahtani’s bouquet of flowers on his face. Ask BOZ Ndola office old guards who are witnesses to Abha telling the bugger off. Then came in another Abha, Abha Chaturvedi who he messed up and Chaturvedi almost divorced her. Then comes Zahida Esa, Ndlovu, Joan and Mrs. Parekh, a widow who he exploited and misused. Ask security guards at his Ndola home, office, Finance House Lusaka office, Zamsure Garden, Pamodzi Hotel and Michelangelo Hotel Sandton, South Africa, Intercontinental South Africa. He is a worse case than Sata. Both are suffering from prostate cancer, heart and the mysterious disease. On KCM, Mahtani was involved. He and late Mwanawasa were paid 25 million dollars each. Purchase consideration of 25 million dollars was paid from KCM bank account that had 116 million dollars bank balance on the date Agarwal took charge of the mine. Ka Mahtani was involved with Kagem Mining swindling, RAMCOZ (Binani), Carlington maize rip off, ZESCO rip off, ZRA rip off, NAPSA rip off, Crude Oil import rip off, Zambezi Portland Cement rip off, Copper Harvest rip off, School desk rip off (Furncoz), Finance Bank rip off, Leasing Finance rip off. Let us bid farewell to Sata, then we will take on this enemy of Zambia. It will be fun to have him and his money laundering criminal partners Mary Schultz, Barkat Ali, Joan Craven, Peter and Ramesh to account for their involvement in shoddy deals.

  6. Benny

    @Mrs. Parekh – indeed you are telling the truth … my family has watched this womanizing sleaze for years. he is a disgusting disloyal liar, Rajan Mahtani.

  7. FWB

    Anil Agarwal and Rajan Mahtani come from the same corrupt school of business – steal all that you can, and then convince Zambians that this theft is “OK” because they are “hard working businessmen who saw opportunity.” This is theft, plain and simple, and we must sort them both out.

  8. Absurdio

    Baka bwalala abo and we are busy arresting one another for stealing a tray of buns.. Awe mwe

  9. stephen

    Wonders shall never cease! Its high time as a country we did something with our copper. I always wonder what is wrong with the technocrates that this country has. Every were the incopetency is there to show. To day it is the mines. Yesterday they were roads! Nowander we still even have roads under construction at the same time with waves and potholes! As this man ‘ MUTANI’ he needs RB or Amin’s Formula to deal with him if he will be proved guilt. Boma nalyeve should not be just be there to pritend to be protecting and maintaining the labour force when the so called INFESTORS are busy looting our own resources. It seems the Government and the INFESTORS are taking Zambians for granted when dealing with our own natural resources. This is the only Zambia we have and copper is one God given natural resource. Besides once our mineral resources are being taken out, there is no replacement being made.

  10. Read Changala

    If Mahtani is “innocent” than how come he is always finding himself in so much trouble???

    President Michael Sata is being held hostage by a clique that has turned the judiciary into a circus, Forum for Democracy and Development (FDD) member Brebner Changala has charged.

    As a result he said, Mr Sata appeared totally incapable of controlling what was happening because the people he trusted with very sensitive offices abused their powers by making reckless decisions which the President failed to check or censure.

    “I appeal to the decent senior members of the PF such as Alexander Chikwanda and Dr Guy Scott to help and prevail on the President so that he can free himself from the clique that is leading him to hell,” he said.

    He was reacting to revelations that Finance Bank (Z) Ltd had discontinued its court claim of $4 million against defunct Zambian Airways owned among others by Mutembo Nchito the Director of Public Prosecutions who earlier this year entered a Nolle Prosequi against Finance Bank chairman Rajan Mahtani and his lawyer John Sangwa who were accused of forgery, uttering a false document and fabricating evidence.

    The transaction, he said posed the question of abuse of authority which could only be cleared by an investigation.

    It was for this reason Mr Changala said, that he had written to State House asking the President to examine the Nolle that the Director of Public Prosecution (DPP) office had extended to Dr Mahtani and his lawyer Sangwa.

    The new development made the case even more imperative.

    “I asked the Anti Corruption Commission to seriously look at this matter because there were elements suggesting corruption and abuse of office, surprisingly everybody grew cold feet, and I have now been vindicated.“Worse things are yet to come if this is the way we are going to be governed. I invite serious opposition political parties and the civil society to really monitor what is happening in the country at the moment.

    “Every body has grown cold feet as the judiciary is being disorganised by a clique holding the President of Zambia hostage,” Changala said.He cited the case of Judge Chalwe Muchenga who was called all sorts of bad names when he gave former Health permanent secretary Kashiwa Bulaya a Nolle.

  11. Richie Rich

    Mr. Changala is fighting for the silent majority. People shall speak in one voice for investigation and suspension of Nchito till he is cleared or he shall be fired and cases reopened against Mr. Mathani.

  12. good fella

    Government must make these people disappear from Zambia as there business skills are substandard.
    They should also liquidate the Ventriglias and the raddison blu people. All these people are killing our nation

  13. Maningi

    Zambian watchdog has indeed gone to dogs. Its owners will have shock of their life once Dr. Nevers Mumba or Fr Bwalya takes over from PF. I stopped commenting on their site ages ago. It is funded by money launderers and has only one agenda to prop up HH as savior of Zambia and launder Mahtani as the most benevolent, law abiding and gentle financier.

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