Vedanta to pay $34 million to raise Malco stake to 93 per cent

Mining and metals major Vedanta Resources that controls India-focused Sterling Group, has accepted the discovered price of Rs115 per equity share for about 14.9 million additional shares in Madras Aluminium Company (MALCO), in which it already owns 80 per cent stake.

The purchase of shares is being managed by Twin Star Holdings Ltd, a unit of Vedanta Resources Plc, which on 26 February, made a cash offer to acquire the outstanding 20 per cent of the company it doesn't own. Twin Star Holdings is a unit of Vedanta Resources.

The offer to shareholders holding shares in the dematerialised form was carried out by way of a reverse book build tender which closed on 20 March 2009.

Vedanta will apply for delisting of Malco from the Indian stock exchanges once the requisite approvals have been received. 

Vedanta will also accept shares from the minority shareholders holding Malco shares in either dematerialised form or physical form at the discovered price of Rs115 per equity share for a period of six months from the date of the delisting.

Malco shares closed at Rs108.25 on the Bombay Stock Exchange on Friday. The settlement date for the offer closes on 25 March, according to an advertisement published by the group.

Vedanta registered a 98.5 percent fall in third-quarter core profit due to low metal prices, inventory writedowns and currency losses.

Vedanta reported a 12 per cent rise in aluminium production at 328,000 tonnes in the nine months of fiscal 2008-09 ended 31 December compared to the same period of the previous fiscal 2007-08.