Less is more

2 July 2018 By Una Galani Follow @ugalani

Chairman Anil Agarwal’s offer of a 28 pct premium for the mining group’s 2.3 bln pound UK unit is probably enough for investors spooked by deadly protests. They can invest directly in the Indian operations anyway. And a simpler structure paves the way for more dealmaking.

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Vedanta Resources said on July 2 that the family trust of Chairman Anil Agarwal had made an initial offer to buy out the 33.5 percent of shares of the company that it doesn’t already own, valuing the London-listed mining group at 2.3 billion pounds ($3.03 billion).

The offer of 825 pence per share in cash is a 27.6 percent premium to the company’s closing price on Friday. Shareholders will also be entitled to receive a previously announced dividend of 41 cents per share, the company said, adding that this would boost the value of the offer to 856 pence per share.

An independent committee of Vedanta’s board formed to review and evaluate the proposal indicated it would recommend a firm offer. Volcan, Agarwal’s family trust, would expect to include a 90 percent acceptance condition as part of its offer, Vedanta added.

Vedanta Resources owns just over 50 percent of Mumbai-listed Vedanta Limited, which has a market capitalisation of almost $13 billion.

Shares in Vedanta Resources were up 27 percent at 822 pence per share by 0830 GMT on July 2. Shares in Vedanta Limited fell more than 2 percent to 230 rupees per share by 0715 GMT.

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