Vedanta Demerger Gets Approval From The Majority Of Creditors

Vedanta Limited is an Indian multinational mining company headquartered in Mumbai, with its main operations in iron ore, gold, and aluminum mines in Goa, Karnataka, Rajasthan, and Odisha. The company primarily operated in Goa and Karnataka, it has gradually expanded its operations in recent years to Odisha, Rajasthan, Chhattisgarh, Tamil Nadu, Punjab, Jharkhand, Gujarat, and Andhra Pradesh. The Group has got approval from the majority of the creditors for its demerger.

Demerger Details

Last year, Anil Aggarwal announced the future demerger plans of Vedanta Ltd into 5 different business units, As per the demerger plan, for every share of Vedanta Ltd, investors will receive one share in each of the five new businesses- aluminum, oil, and gas, power, steel and ferrous, base metals and an incubator for new businesses including semiconductors.

For every share of Vedanta, shareholders will receive one share of each of the five newly listed companies. After the demerger, the businesses of Hindustan Zinc as well as the electronics business will remain with Vedanta Limited.

Vedanta Got Approval from a majority of Creditors

Vedanta Limited has secured approvals from the majority of its creditors for a proposed demerger, a significant milestone in its plan to split into six independent listed companies. A senior Vedanta executive announced during a bondholder conference call, “I am happy to let all of you know that we have received the 52% plus the additional percentage, which is required for us to reach 75%. We have crossed that threshold as well. Most of the lenders have approved it.” State Bank of India, a major creditor, had already granted its consent earlier, according to an informed banker. This critical approval fulfills the last major compliance requirement, paving the way for the USD 20 billion demerger.

Conclusion: With majority creditor approval secured, Vedanta Ltd is set to demerge into six independent listed companies, each focusing on a specific sector. This strategic move, valued at USD 20 billion, will enhance operational focus and unlock shareholder value, while Vedanta Limited continues to oversee Hindustan Zinc and its electronics business.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.