The big news clanging around is that Anglo American are getting a new investor, in the form of Anil Agarwal. Agarwal is the founder and chairman of Vedanta Resources, according to Wiki, he controls the business through his investment vehicle Volcan Investments. Sounds almost superhero like. He sounds like a bit of a scrapper, the Carl Icahn type, rather than a polished high society fellow, like Bill Ackman. We need all these people. He has been around for 4 decades, he has done the hard yards.
Here is the announcement from stock exchange news - Volcan Investments Ltd announces an investment in Anglo American plc. It is a little complicated:
"Volcan Investments Ltd ('Volcan'), announces today that it intends to make an investment in Anglo American plc shares of up to 2.0 billion Pounds. Volcan intends to finance the investment in Anglo American plc shares through the issuance by Volcan Holdings plc (the 'Issuer'), a wholly owned subsidiary of Volcan, of a mandatory exchangeable bond, led by J.P. Morgan as Sole Bookrunner, on or around 11 April 2017 ("Closing Date") that will be secured by Anglo American plc shares. Volcan and the Issuer intend to purchase the Anglo American plc shares in the market via a combination of purchases from investors in the mandatory exchangeable bond and on market purchases, subject to certain conditions, until or close to the Closing Date."
Well, good for Anglo American, whether or not this is the "right time" in the cycle, Mr. Agarwal is getting a discount.
In May of 2008, Anglo American's LSE price was 35 Pound Sterling, they are currently 12 Pounds, having rallied 131 percent over the last year. Agarwal, good for him, I suspect that South African investors may well warm to this chap, if he is right about Indian infrastructure requiring a "lot" of resources over time, he may well be the right man. Board seat, useful insight, good for the business. Now, let them just close the nitty gritty of the deal.