The potential deal follows a global commodities boom that’s fueled a rally in Vedanta Ltd. shares and almost doubled its market capitalization in the past year to about $17 billion. Deliberations are still at an early stage, and there’s no certainty Agarwal will decide to pursue a transaction, the people said.

Agarwal didn’t immediately respond to a request for comment. A representative for Vedanta said there is “no plan” to merge Vedanta Resources with Vedanta Ltd.

Vedanta Resources has already been raising its stake in its unit through an open offer and share purchases from the market after a failed takeover attempt. As of December it owned almost 70% of Vedanta Ltd., up from about 50% in October 2020. It had about $11.4 billion of net debt as of Sept. 30, according to a corporate presentation.

The holding company was the first Indian business to list in London back in 2003, before Agarwal, 68, took it private 15 years later when his Volcan Investments Ltd. bought out minority investors as part of efforts to streamline the group’s structure. Vedanta Resources also owns a 79.4% stake in Zambia’s Konkola Copper Mines, which has been under provisional liquidation since May 2019 and the matter is still the subject of court cases and arbitration proceedings.

Billionaire Commodities Dealmaker Gets Squeezed by Rising Rates

Vedanta Ltd. said in December that it intends to unlock value with options including separately listing its aluminum, iron and steel and oil and gas businesses. The board has formed a panel to evaluate the plan, it said in a filing. The Press Trust of India reported last week that the company will outline details by end-March.

Subsidiaries of Vedanta Ltd. include Hindustan Zinc Ltd., Bharat Aluminium Co., Talwandi Sabo Power Ltd. and Electrosteels Steel Ltd., according to the corporate presentation. In December, Hindustan Zinc said it would pay $1 billion as interim dividend.

Vedanta Ltd. had cash and equivalents of about 252 billion rupees ($3.4 billion) as of Dec. 31, according to company filings. Profit surged more than fivefold to 46.2 billion rupees in the three months through September, followed by a 26% year-on-year increase in the quarter ended December.

Agarwal, a former scrap metals trader, rose to become a commodities magnate through a series of ambitious acquisitions. He has a net worth of about $3 billion, according to the Bloomberg Billionaires Index.