Vedanta Resources chairman Anil Agarwal says fund to buy BPCL, SCI

Vedanta Resources Ltd's plan to set up a $10 billion fund to buy state-owned firms has attracted interest from sovereign wealth funds and the corpus will be floated once the government invites a price for firms such as BPCL or Shipping Corporation of India SCI, according to its chairman. Metals and mining magnate Anil Agarwal said they were interested in the acquisition of government stake in Bharat Petroleum Corporation Ltd BPCL and SCI, worth over $12 billion.

Agarwal said in an interview that they are creating a $10 billion fund.

The fund is made of Vedanta's own resources and outside investment. He said that we have a tremendous response for this, especially from the sovereign wealth funds.

The idea is to create a fund with a 10 year life span, which will use a private equity type strategy, buying into companies and boosting their profitability before seeking an exit.

Agarwal previously stated that Vedanta would team up with London-based firm Centricus to create a $10 billion fund that will invest in stake sale of public sector undertakings.

They all want me to be the chairman, he told PTI in the interview.

Vedanta completed the due diligence of BPCL, but the government earlier this month postponed the invitation for the sale of its stake in SCI. The government hasn't indicated a date for invitations for price bids for BPCL or SCI.

In no time, we can raise a disinvestment programme when the government starts coming out with a disinvestment programme. Nobody wants to put in money and pay fees and other costs. As soon as the government activates the bidding process, we will move forward. Money won't be a problem, he said.

Agarwal, who turned a tiny scrap metal business into London-based Vedanta Resources, made a fortune buying state companies and fixing them. In 2001, it acquired Bharat Aluminium Company Ltd BALCO, followed by the acquisition of the loss-making Hindustan Zinc in 2002-03.

In 2007 it acquired 51 per cent of the controlling stake in Sesa Goa Ltd from Mitsui Co and in 2018 Vedanta snapped up Electrosteel Steels Ltd ESL pipping suitors like Tata Steel.

He is now trying to replicate that success, in order to spot gems among the dozens of companies put on the block by Prime Minister Narendra Modi to raise record proceeds.

In India, the entrepreneurial dynamism can be harnessed to unlock incredible transformation in the public sector, Agarwal said. We believe that this strategy can, and will, play a crucial role in the country's ongoing industrialisation. Vedanta is exploring opportunities for zinc, gold and magnesium mines in Saudi Arabia.