Indian mining group Vedanta Resources Plc said on Monday it had bought a 9.5 percent stake in Canada's HudBay Minerals Inc but gave no reason for the move.
London-listed Vedanta, India's largest base metals miner, confirmed a Globe and Mail newspaper report that it had bought the stake, 14.5 million hudBay shares, through a subsidiary, Lakomasko BV, a privately-held company based in Amsterdam.
“They do control that stake. It (Lakomasko) is an organisation that is controlled by Vedanta Resources,” Vedanta spokesman Robin Walker said in London, declining further comment.
HudBay shares were up 3.3 percent to C$7.83 by 1515 GMT, adding to a 9 percent rise on Friday. The shares have more than doubled in 2009 since ending last year at C$3.06.
The Globe identified K. Coimbatore Venkatakrishnan as the principal and top executive of Lakomasko. He was the chief executive of Vedanta's Konkola Copper Mines in 2006. KCM is Zambia's largest copper producer.
Vedanta, which has been aggressively expanding outside its home base in India, last week got approval from a U.S. bankruptcy judge to go ahead with a plan for its unit Sterlite to buy copper miner Asarco LLC for $1.7 billion. [ID:nN22274894]
HudBay chief executive Peter Jones began his second stint as CEO last month after a failed attempt to take over fellow Canadian miner Lundin Mining prompted a shareholder revolt that forced the company's former board and management to step down.
Jones's first turn as CEO ended when he was pushed out in January 2008 for not seeking acquisitions aggressively enough. He said in March that HudBay would try to expand through takeovers, and may be open to overtures from larger players.
Jones was part of a slate put forward by shareholder SRM Global Master Fund, which wanted HudBay to distribute its war chest of approximately C$700 million to shareholders.
Jones has said the company will only do that if attempts to expand through acquisition fail.
The company also said in March that it had had talks with third parties concerning a possible sale of the company, but no discussions were under way at that time.
Source: Reuters