Vedanta in race to buy US co Aleris

MUMBAI: Mining mogul Anil Agarwal’s Vedanta Resources Plc is considering a bid for US aluminium products maker Al er is Corp ., a move that may pit it against Hi nd al co Industries Ltd’ s $2.5 billion bid for the US company, two people aware of the development have said.

Apart from Vedanta, a Japanese metals company may also join the fray for Aleris, a third person familiar with the development said on condition of anonymity. The name of the Japanese company could not be immediately ascertained.

“While there is no certainty that Vedanta will eventually make a bid for Al er is, competitive bidding if it happens can make the deal expensive for the acquirer, ”sai done of the two people cited earlier, requesting anonymity.

Requests for comment sent to Vedanta group remained unanswered until press time on Wednesday, while a spokesperson for Ad it ya Group said “inline with our policy we do not comment on market stories”. A spokesperson for Al er is said that they do not comment or speculate on rumours.

Vedanta group, which has raised close to $2 billion in the past one year, has been on an acquisitive mode in India as well and has shown interest in at least two di stressed steel companies in India. Mint reported in December that Vedanta group was among the potential suitors for debtladen Essar Steel, which is currently under corporate insolvency proceedings. Apart from Essar Steel, Vedanta has also made a bid to acquire Electro steel Steels Ltd, which is also under corporate insolvency, the people cited above said.

Mint reported in September that billionaire Kumar Mangalam Birla’s Aditya Birla Group, the controlling shareholders of Hindalco, was among potential bidders for Aleris for which the group was looking to assign a $2.5 billion enterprise value for Cl eve- land, Ohio-based Al er is. The offer is expected to include an investment of close to $1 billion through equity and debt, and refinancing of the company’s debt of around $1.5 billion, Mint had reported citing people aware of the matter.

Earlier this month, Bloomberg reported that Hindalco Industries made anon-binding offer for Al er is through its US unit Novel is Inc.

“The transaction is likely to be driven from the US by Novelis which will raise bulk of the acquisition funding whereas its parent Hi nd al co will only fund a smaller chunk if the acquisition goes through ,” said the second person cited above, also requesting anonymity.