Vedanta head Anil Agarwal has once again hit the headlines by announcing an intended further personal investment in Anglo American through Volcan Investments, which is the majority shareholder of Vedanta Resources.
Volcan announced last week that it intended investing £1.25-billion to £1.5-billion in Anglo shares, following its £2-billion investment in the London- and Johannesburg-listed group in March.
Reuters quotes an unnamed banking source as calculating that the additional shares could take Volcan’s interest up to 20%.
Vedanta confirmed in a release to Creamer Media’s Mining Weekly that the proposed investment is by Volcan alone, with no participation from the London-listed Vedanta.
“This is a personal investment made by Mr Agarwal through Volcan. It is not a Vedanta investment. Vedanta has no involvement in this transaction,” a spokesperson who did not want to be quoted told Mining Weekly.
Independent directors of Vedanta, advised by Moelis & Company UK LLP and Ashurst LLP, have consented to the proposed investment on the basis of a relationship agreement between Volcan and Vedanta.
In 2010, Vedanta bought Anglo’s zinc assets, the bulk being in Southern Africa, for $1 338-million and managed to achieve full payback two years later through decisive underground and near-pit mining.
Vedanta Zinc International’s Black Mountain Mine is currently building a zinc mine at Gamsberg, in South Africa’s Northern Cape, an asset previously owned by Anglo.
This greenfield project consists of an opencast mine, ore beneficiation plant and associated infrastructure, and is located on one of the world’s largest known zinc deposits, where Vedanta is investing $400-million in developing the first phase of the opencast zinc mine, concentrator plant and associated infrastructure. The first phase encompasses a four-million-tonne-a-year zinc and lead concentrator.
Mining Weekly reported last month that more than 80% of the $400-million capital expenditure for the first phase of Gamsberg has been committed.
The first phase of the project is expected to have a mine life of 13 years, replacing the production lost by the closure of the Lisheen mine, in Ireland, and restoring Zinc International’s volumes to more than 300 000 t/y.
Manufacturing of critical machinery is under way, with major contractors such as Aveng Moolmans, ELB Group and Liviero Civils mobilised to site.