Mumbai: Mining mogul Anil Agarwal’s Vedanta Resources Plc. is considering a bid for Aleris Corp., a move that may pit it against Hindalco Industries Ltd’s $2.5 billion bid for the US-based aluminium products maker, two people aware of the development said.

Apart from Vedanta, a Japanese metals company may also join the contest for Aleris, a third person familiar with the development said on condition of anonymity. The name of the Japanese company could not immediately be ascertained.

“While there is no certainty that Vedanta will eventually make a bid for Aleris, competitive bidding, if it happens, can make the deal expensive for the acquirer," said one of the two people cited in the first instance, requesting anonymity.

Requests for comment sent to Vedanta group remained unanswered until press time on Wednesday. A spokesperson for the Aditya Birla Group, of which Hindalco Industries is a part, said that “in line with our policy we do not comment on market stories". A spokesperson for Aleris said the company did not comment or speculate on rumours.

Vedanta Resources has mines across the world and oil and gas operations in three countries. Its main products are copper, zinc, aluminium, lead, iron ore and petroleum.

Vedanta group, which has raised close to $2 billion in the past one year, has been on an acquisitive mode in India as well and has shown interest in at least two distressed steel companies.

Mint reported in December that Vedanta group was among the potential suitors for debt-laden Essar Steel Ltd, which is currently under corporate insolvency proceedings.

Apart from Essar Steel, Vedanta has also made a bid to acquire Electrosteel Steels Ltd, which is also under corporate insolvency proceedings, the people cited above said.

Mint reported in September that the Aditya Birla Group was among potential bidders for the Cleveland, Ohio-based Aleris for which the group was looking to assign a $2.5 billion enterprise value.

The offer is expected to include an investment of close to $1 billion through equity and debt, and refinancing of the company’s debt of around $1.5 billion, Mint reported, citing people aware of the matter.

Earlier this month, Bloomberg reported that Hindalco Industries had made a non-binding offer for Aleris through its US unit Novelis Inc.

“The transaction is likely to be driven from the US by Novelis, which will raise bulk of the acquisition funding whereas its parent Hindalco will only fund a smaller chunk if the acquisition goes through," said the second person cited above, also requesting anonymity.

Aleris’s private equity owners Oaktree Capital Group LLC and Apollo Global Management LLC had earlier agreed to sell the company to Zhongwang USA LLC for an enterprise value of $2.3 billion.

The transaction was called off in November after US officials raised national-security concerns about the Chinese-backed bidder, Bloomberg reported in January.