Cloud hangs over ENRC's purchase of Zambian assets Eurasian Natural Resources Corp bought copper mining assets in Zambia for 46 times what the FTSE 100 company's founding shareholders paid for them seven years earlier, according to an FT analysis. In February 2010 ENRC agreed to pay $300m in cash to acquire Enya Holdings, which owned a 90 per cent stake in Chambishi Metals in Zambia, a copper and cobalt producer, and its marketing arm. By the numbers: ENRC Share price, market cap, and advisory fees Netherlands-based Enya, whose shareholders were the "trio" of ENRC's founding central Asian oligarchs - Alexander Mashkevich, Alijan Ibragimov and Patokh Chodiev - paid only $6.5m for Chambishi in 2003. The vendor was South African company Anglovaal Mining. The Chambishi transaction is one of several ENRC deals that have been referred to the UK's Serious Fraud Office, according to a letter law firm Dechert sent to ENRC. Dechert had been appointed by ENRC to conduct an internal fraud probe, but was dismissed in March. Dechert stated it had found "evidence that a senior executive had falsely altered inputs into the valuation model which was relied upon by advisers to the company and board." It also wrote that "information from a whistleblower together with documentary evidence regarding the making of cash payments to African presidents was to be provided [including that the payment (s) had been sanctioned by a senior executive]." ENRC reportedly denied there was evidence to back up the allegations. A spokesperson for ENRC's founders said all the transactions "went through the most rigorous checks in accordance with both the letter and the spirit of all the regulatory requirements." For example, the Chambishi transaction followed seven years of investment amounting to at least $200m and a huge amount of management energy. This was fully recognised by ENRC's advisers when they approved the deal after a comprehensive audit. ENRC declined to comment. At the time the company deemed the Chambishi purchase "a smaller related-party transaction" and Credit Suisse, an adviser, said it represented fair value for ENRC shareholders. Lazard advised the independent directors on the transaction. Two years later ENRC wrote off nearly a third of the investment when Chambishi was hit with a $96m impairment charge because of higher than expected development costs, according to the company's 2012 accounts. The Chambishi copper deal was one in a series of so-called "related-party transactions" connected to asset purchases totalling $1.4bn that ENRC made since its London listing in 2007. According to the group's annual report, the UK Listings Authority has mounted a probe into possible breaches of rules concerning related-party transactions. Other prominent related-party transactions include ENRC's $800m purchase of Shubarkol, a coal producer in Kazakhstan, from a company that was majority-owned by ENRC's founding shareholders. In 2008 ENRC acquired Russia-based Serov, a ferrochrome producer, for $210m from "various entities affiliated" to the founding shareholders, according to company filings. ENRC also made several smaller related-party transactions, such as paying more than $50m in cash for railway wagons from a company owned by the trio, according to company filings.