Anil Agarwal-owned family trust Volcan Investments intends to invest £2 billion in the shares of Anglo American plc, a global and diversified mining company, through compulsory convertible bonds.
Volcan plans to finance the investment in Anglo American plc shares by April 11 through Volcan Holdings plc, a wholly owned subsidiary of Volcan, said Anglo American plc in a statement on Thursday.
The investment comes even as the Vedanta Group had committed to invest $1 billion in setting up a one million tonne pig iron and ductile pipe plant at Manoharpur in West Singhbhum district of Jharkhand.
Meanwhile, Volcan will invest in the mandatory exchangeable bonds, secured by Anglo American plc shares. The issue is led JP Morgan as sole bookrunner, it added.
In operation for 100 years, Anglo American plc has mining and business interest in copper, platinum, diamond, iron ore, manganese, coal and nickel. Headquartered in London, it has mining interest in South Africa and Australia.
The company recorded attributable free cash flow of $2.6 billion and Ebitda of $6.1 billion. It is listed on London and Johannesburg stock exchanges.
Volcan and the issuer intend to purchase the Anglo American plc shares in the market via a combination of purchases from investors in the mandatory exchangeable bond and on market purchases, subject to certain conditions, the statement issued by Volcan said.
In relation to the UK Takeover Code, Volcan confirms that it does not intend to make an offer to acquire Anglo American plc. Accordingly, Volcan and all persons acting in concert with Volcan, including Vedanta Resources plc, will be bound by the restrictions in Rule 2.8 of the Code, it added.
Anil Agarwal, Chairman, Vedanta Resources, said it is an attractive investment for the family trust.
"Anglo American plc is a great company with excellent assets and a strong board and management team which is executing a focused strategy to drive shareholder value," he added.