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Vedanta Ltd, a natural resource group, lost 20% of its market value on Friday, as investors hesitated over an agreement to acquire a stake in one of the world's largest miners, along with its founder and majority shareholder, Anil Agarwal.
Shares of the Indian-led group fell 19.9% to 158.15 rupees the lowest in 30 days after the company announced in a statement that its oil unit had paid $ 200 million for a stake in Anglo American of Volcan Investments. The trust of Mr. Agarwal's family.
Thanks to a complex capital markets instrument created by JPMorgan's bankers, Mr. Agarwal was able to acquire a 20% stake in Anglo, becoming the company's largest shareholder.
When the deal was revealed for the first time in 2017, it caused rumors that Mr. Agarwal was preparing an offer on Anglo American. Mr. Agarwal had already attempted to merge Anglo American with his zinc company in the country.
This speculation has now cooled but it is unclear what Mr Agarwal will do when the notes expire next year. Although he has the opportunity to buy the underlying stocks, it is unclear how he could finance such a deal. Anglo American has a market value of $ 32.9 billion and its shares have grown more than 70% over the past two years.
The agreement reached Friday between Cairn and Volcano will raise new questions about corporate governance at Vedanta Ltd, a company that many investors avoid because of its complex structure.
"Cairn India Holdings invested its cash surpluses in Anglo American, which was better than investing in fixed deposits with low foreign exchange yields," said Srinivasan Venkatakrishnan, Vedanta's new general manager.
Last year, Mr. Agarwal, a self-taught billionaire, paid nearly 800 million pounds to buy back minority shareholders of his London-listed vehicle, as part of a plan to simplify the structure of the company. its sprawling commercial empire.
Vedanta Ltd produces everything from aluminum to copper, including zinc, oil and gas.
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