Vedanta aiming to raise £600m from UK listing

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Vedanta Resources, the mining company owned by the flamboyant Indian entrepreneur Anil Agarwal, aims to raise up to £600m from listing in London in early December, giving it a market capitalisation of £1.2bn.

Market sources expect Vedanta to price its shares at between 360p-450p a share on 5 December. This would make the stake held by Mr Agarwal worth £660m and make him one of the wealthiest businessmen in Britain.

Brian Gilbertson, the former chief executive of the miner BHP Billiton, is to become chairman of Vedanta and will also profit from the float. He is being given 1 per cent of the company as a gift from the Agarwal family. This would be worth £12m on flotation, and Mr Gilbertson will also be paid £350,000 a year. Vedanta will also pay half his office and secretarial costs.

Mr Gilbertson is no stranger to controversy over his pay. He got a golden handshake of £4m on leaving BHP Billiton due to "irreconcilable differences" after only six months in the job.

Mr Agarwal, known for paying himself liberally from his company in the past, will be paid £425,000 for running the business, with the opportunity to double this through bonuses.

He will also have a car and driver supplied for business and private use.

Vedanta has also set up a nominations and audit committee to make the company comply with UK corporate governance rules.

The listing would be the second largest seen on the London Stock Exchange this year, and the first primary listing by an Indian company in the UK. Mr Agarwal, 51, began building his fortune in 1976 by ensuring himself a central role in the privatisation of India's metals and mining industries.

Mr Agarwal, who is applying to become a British resident and owns a £20m property in Mayfair, and Mr Gilbertson are hitting the City this week, looking for potential investors.

Vedanta hopes to place at least 110 million shares and a further 16.5 million shares may be issued in an over-allotment option. If all 126.5 million shares are issued, Mr Agarwal's stake will be diluted to 55 per cent.

Vedanta is now a holding company for a number of copper, aluminium and zinc mines, including Sterlite Industries, in which it has a 60 per cent stake.

The money raised would be used to expand Sterlite's aluminium mining operations.