ANIL Agarwal’s proposal that his family-owned Volcan Investments buy out minority shareholders in Vedanta may not be cake walk, according to Reuters which cited a source as saying he would oppose the $1bn offer.
“We think that this offer is very opportunistic and massively undervalues Vedanta,” a shareholder, who declined to be identified, told Reuters. “It’s the worst possible time for minority shareholders to be taken private,” he said, adding that he believed Vedanta was worth between £11 and £12 a share.
Agarwal, on Monday announced that its independent board directors were prepared to back an 825 pence a share bid from Agarwal’s family trust, Volcan, to acquire the 33.5% of the company that it does not already own and delist the group.
Under the proposal, Volcan would spend £778m ($1bn) buying out minority investors in a deal which would value Vedanta as a whole at about £2.35bn. Barclays analysts said earlier this week that Agarwal was “opportunistic” and may encounter “… some resistance from minority shareholders”.
