Shares in Anglo American (LON:AAL) have jumped in London this morning, as Volcan Investments, the family trust of Indian billionaire Anil Agarwal, announced plans to buy up to £1.5 billion in shares. The move comes after Volcan made a surprise £2-billion investment in the blue-chip miner earlier this year.
As of 10:38 BST, Anglo American’s share price had added 2.67 percent to 1,328.50p, outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.04 percent higher at 7,275.19 points. The group’s shares have added just under 50 percent to their value over the past year, and are up by some 14 percent in the year-to-date.
Volcan Investments disclosed in a statement to the London Stock Exchange yesterday that it intended to make a further investment in Anglo American of between £1.25 billion and £1.5 billion, in addition to the group’s current 12.43-percent voting interest in the blue-chip miner.
“We are encouraged by the performance of Anglo American since our original investment earlier this year,” Anil Agarwal commented in the statement, adding that the FTSE 100 group had “made good progress in its operational and financial performance and remains an attractive investment for our family trust”.
The Telegraph noted in its coverage of the news that the latest purchase would take Agarwal’s existing stake in Anglo American to a holding of just over 20 percent, meaning he would leapfrog Public Investment Corp to become the miner’s largest stakeholder. Volcan Investments, however, confirmed in the statement that it did not intend to make an offer to acquire the whole FTSE 100 group.
As of September 15, the consensus forecast amongst 24 polled investment analysts covering Anglo American for the Financial Times advises investors to hold their position in the company.