Mining giant Vedanta Resources has paid $981m for a controlling 51% stake in Sesa Goa from Mitsui & Co, it said Tuesday, and is looking to buy another 20% through an open offer that will take the total cost to $1.37bn.
It said the deal will create India's largest diversified mining group, with leading market positions in aluminium, copper, zinc and iron ore together with an industry leading pipeline of expansion projects.
The open offer to Sesa shareholders is expected to complete by July, with the total cost of the deal to be financed through a mix of newly committed bank debt facilities of $1.1bn and existing cash resources.
"This acquisition provides us with an industry leadership position in the attractive iron ore business in India," said chairman Anil Agarwal.
"This transaction is immediately earnings and cash flow accretive and we believe it will create significant long term value for all our stakeholders."
Sesa reported group turnover of $423.2m, EBITDA of $194.8m and profit before tax of $193.8m at 31 March 2006, with a net cash position of $120.4m.
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