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Vedanta Resources (VED)

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Tuesday 13 June, 2006

Vedanta Resources


Vedanta Resources PLC
13 June 2006

                                                                    13 June 2006


Vedanta Resources plc ('Vedanta') announced today that it has entered into an
agreement to acquire a controlling interest in Sterlite Gold Ltd. (TSX: SGD)
('Sterlite Gold'), and that it plans to make a cash offer to acquire, directly
or indirectly, all of the outstanding common shares of Sterlite Gold.

Vedanta announces its intention to make a full cash offer for Sterlite Gold, a
gold mining company listed on the Toronto Stock Exchange ('TSX'), for a total
consideration of C$68.45 million (the 'Sterlite Gold Offer'), representing a
price of C$0.258 per Sterlite Gold common share. As part of this transaction,
Vedanta has entered into an agreement to acquire the entire issued share capital
of Twin Star International Limited ('TSI'), the holder of 55.0% of Sterlite
Gold's common shares, for C$37.68 million in cash (the 'TSI Acquisition'),
representing an imputed price of C$0.258 per underlying Sterlite Gold common

Sterlite Gold's principal assets are located in Armenia and include an open pit
gold mine at Zod and a gold processing plant at Ararat. In October 2004,
Sterlite Gold announced measured and indicated resources estimated at 2.1
million ounces. Vedanta believes that the acquisition offers an attractive low
risk exposure to this commodity and provides the opportunity to deploy its
proven project development skills. Vedanta believes Zod has the potential to be
a world class mine, with existing development potential in addition to
exploration upside. The acquisition will also provide Vedanta with the expertise
to take advantage of other gold opportunities, particularly in India.

The board of directors of Sterlite Gold appointed a committee of independent
directors (the 'Sterlite Gold Independent Committee') to review the terms of the
proposed Sterlite Gold Offer. The Sterlite Gold Independent Committee retained
PricewaterhouseCoopers ('PwC') to prepare a valuation of the Sterlite Gold
common shares in compliance with Canadian securities laws, including Ontario
Securities Commission Rule 61-501 ('Rule 61-501'). PwC has advised the board of
directors of Sterlite Gold and the Sterlite Gold Independent Committee that the
offer price is within its valuation range of C$0.24 to C$0.275 per share. The
board of directors of Sterlite Gold, on the recommendation of the Sterlite Gold
Independent Committee, has unanimously approved the Sterlite Gold Offer and has
agreed to recommend that shareholders of Sterlite Gold tender their common
shares to the Sterlite Gold Offer.

The Sterlite Gold Offer will be subject to customary conditions including all
regulatory approvals having been obtained and acceptance by (i) at least 662/3%
of the total number of issued and outstanding Sterlite Gold common shares, and
(ii) not less than a majority of the total number of issued and outstanding
Sterlite Gold common shares, excluding any common shares that may not be
included as part of the minority approval of a second step transaction. Further
details will be contained in the takeover bid circular to be mailed to Sterlite
Gold common shareholders, which will also include a copy of the PwC valuation.

Vedanta and Sterlite Gold are under common control. Volcan Investments Limited
('Volcan') owns 53.76% of the ordinary shares of Vedanta and 100% of the shares
of TSI, the controlling shareholder of Sterlite Gold. The transactions
comprising the TSI Acquisition and the Sterlite Gold Offer therefore constitute
a related party transaction under the Listing Rules of the UK Listing Authority
and an insider bid under Canadian securities laws, including Rule 61-501.
Vedanta formed a special committee of directors who are independent of Volcan to
consider and supervise the making of the TSI Acquisition and Sterlite Gold

Vedanta has been advised by HSBC plc, Blake, Cassels & Graydon LLP, Ernst &
Young LLP and SRK. Ernst & Young LLP has provided Vedanta with written
confirmation that the terms of the TSI Acquisition and Sterlite Gold Offer are
fair and reasonable as far as the shareholders of Vedanta are concerned.

'We are excited by this unique growth opportunity and believe the acquisition
while creating value for our shareholders will contribute significantly to the
Armenian economy.' said Mr. Kuldip Kaura, Chief Executive Officer, Vedanta. 'It
will position us well to pursue other gold opportunities including those in

For further information, please contact:

Sumanth Cidambi                         
Associate Director - Investor Relations           Tel: +44 20 7659 4732 / 
                                                  +91 22 6646 1531
Vedanta Resources plc

Faeth Birch
Robin Walker
Finsbury                                           Tel: +44 20 7251 3801

About Vedanta Resources plc

Vedanta Resources plc is a London listed diversified metals and mining group.
Its principal operations are located throughout India, with further operations
in Zambia and Australia. The major metals produced are aluminium, copper, zinc
and lead. For further information, please visit


This press release contains 'forward-looking statements' - that is, statements
related to future, not past, events. In this context, forward-looking statements
often address our expected future business and financial performance, and often
contain words such as 'expects,' 'anticipates,' 'intends,' 'plans,' 'believes,'
'seeks,' 'should' or 'will.' Forward-looking statements by their nature address
matters that are, to different degrees, uncertain. For us, uncertainties arise
from the behaviour of financial and metals markets including the London Metal
Exchange, fluctuations in interest and or exchange rates and metal prices; from
future integration of acquired businesses; and from numerous other matters of
national, regional and global scale, including those of a political, economic,
business, competitive or regulatory nature. These uncertainties may cause our
actual future results to be materially different that those expressed in our
forward-looking statements. We do not undertake to update our forward-looking

                      This information is provided by RNS
            The company news service from the London Stock Exchange