The transaction targets the holding currently owned by Sumitomo Corporation in the major industrial asset, which supplies critical metals used in stainless steel and battery production.
Sandile Zungu is a South African businessman and founder of Zungu Investments Company (ZICO), a private equity firm with interests across mining, energy, infrastructure, manufacturing, and property.
He is also the owner of AmaZulu FC, a top-flight South African football club, and has been involved in several major investment consortiums linked to national infrastructure and resource projects.
Beyond business, he holds prominent leadership roles in South Africa’s Black Business Council and other regional business platforms.
In a recent development, following over two decades of involvement, Sumitomo Corp has revealed it is divesting its 54.17% majority stake in the project. Moving forward, this stake will be owned by a collaborative association between Essenwood Partners and Zungu Investments.
Heavy losses push exit decision
For several years, the Ambatovy project has struggled to meet financial expectations, prompting Sumitomo’s decision to exit.
The company has incurred cumulative losses of approximately $3 billion over the last 20 years and expects to record a further one-time loss of roughly $445 million (¥70 billion) related to the transfer.
Reports indicate that Sumitomo Corp will retain certain offtake rights, allowing it to continue receiving a percentage of the mine’s production. This remains a significant asset; for context, the site produced over 28,000 metric tons of nickel and 2,500 tons of cobalt in 2024.
The global market is currently experiencing a surge in nickel prices, which recently hit a two-year high.
This volatility is driven by a market deficit caused by sulfur shortages, a side effect of the recent war between Israel and Iran which has reduced production in Indonesia, the world’s largest nickel producer.
Sumitomo Corp expressed confidence that the partnership between Essenwood Partners and Zungu Investments will provide the necessary technical and commercial expertise to manage a large-scale nickel and cobalt enterprise profitably.
