A bird flies by the Vedanta office building in Mumbai in this file picture.
Johannesburg - Indian mining mogul Anil Agarwal has said he intended to buy about 13 percent of diversified mining group Anglo American for $2.4 billion (R31.35 billion), but the billionaire said a takeover bid was not on the cards.

Agarwal’s Vedanta Resources said its majority shareholder, Volcan Investments, intended to buy the Anglo stake.

The London-headquartered Vedanta said the proposed investment was made by Volcan alone, and that Vedanta was not participating in the investment.

It said Vedanta’s independent directors had consented to the proposed investment.

The proposed investment, if it goes through, will make Agarwal Anglo the second-largest shareholder after the Public Investment Corporation, which owns 14.5 percent of the global mining firm.

Vedanta has interests in zinc, lead, silver, copper, iron ore, aluminium, power generation, and oil and gas.

Read also: What's behind Anglo's profit surge?

Anglo reportedly rebuffed Agarwal’s informal approaches last year when it was still busy with a restructuring programme that entailed the disposal of non-core assets in the face of the slump in commodity prices.

The restructuring included the sale of niobium, phosphates, coal and platinum assets as the company said it wanted to focus on copper, platinum and diamonds.

However, Anglo returned to profitability in the year ended on December 31, with a rebound in bulk commodity prices and the company's renewed financial strength - prompting the company to put the disposal programme which was meant to improve cash flow and strengthen the balance on hold. Anglo shares traded on the JSE soared 8.9 percent on Thursday morning, before closing 6.53 percent higher at R203.47.

Ashburton fund manager, Wayne McCurrie, said the surge in the share price could be attributed to a general rally in mining stocks in the wake of the US Federal Reserve’s decision on Wednesday evening to raise its key interest rate for a third time in a decade.

“The rand also firmed for the same reason.”

Anglo-American declined to comment on the Agarwal announcement.

BUSINESS REPORT