Essar Energy Plc said its largest shareholder, Essar Global Fund Ltd, has made a possible offer of 70 pence per share for the 22 percent stake it does not own in the London-listed oil and gas producer.
The proposal outline valued Essar Energy, which is controlled by privately held Indian conglomerate Essar Group, at more than 900 million pounds.
Essar Energy said it had constituted an independent committee to consider the outline bid.
The members of the committee, chaired by Philip Aiken AM, are Sattar Hajee Abdoula, Subhas C Lallah, Steve Lucas and Simon Murray. Each is free from conflicts of interest with regard to the proposal, the company said.
It added that it was not certain that any firm offer for the company would be made nor was it certain as to the terms on which any firm offer might be made.
Essar Global had said on Friday that it could make an offer on its own or as part of a consortium at a "modest" premium to the company's Thursday share close of 60 pence on the London Stock Exchange.
The Indian oil and gas company's stock has been steadily declining since its London listing four years ago that started at 420 pence.
Essar Global also made a possible offer to buy Essar Energy's 4.25 percent convertible bonds due 2016 for 80 pence per share.
Standard Life, which holds a minority stake in Essar Energy, criticised Essar Global's plans, cautioned that the bid would deprive small shareholders of the company's future growth value.
"This potential bid is an example of cynical opportunism and should not be allowed to proceed," David Cumming, head of equities at Standard Life Investments, said in a statement sent to journalists.
The company's second-largest shareholder, Capital World Investors, had said on Friday that it could not disclose if it planned to participate in a bid.
Essar Global's latest move is a U-turn from its earlier plans of selling shares to dilute its 78.02 percent stake in Essar Energy so the company could meet UK listing requirements, which mandate that at least 25 percent of a company's stock be available for trading.