Essar Global Fund may buy out Essar Energy: report
15 February 2014
Essar Energy Plc's largest shareholder, Essar Global Fund Ltd, said it was considering making an offer for the 22 per cent stake it does not own in the London-listed oil and gas producer, according to a Reuter report.
The fund had said in November that it would sell shares to dilute its 78.02 per cent stake in Essar Energy so that the company meets UK listing requirements, which mandate that at least 25 per cent of a company's stock be available for trading. But according to the report, it now prefers to buy out the stake from the parent company.
Essar Global said on Friday it could make an offer on its own or as part of a consortium at a "modest" premium to Essar Energy's Thursday close of 60 pence on the London Stock Exchange.
The company's second-largest shareholder, Capital World Investors, said it could not disclose if it planned to participate in a bid.
Essar Global said there was no certainty it would make an offer, and until then it would not transact in the shares of the company even to meet the free float requirement.
Essar Global also said it may offer to buy Essar Energy's 4.25 per cent convertible bonds due 2016.
The oil and gas company is controlled by the Ruias' Indian conglomerate Essar Group, which has interests in steel, shipping, power and other sectors.