Metals & Mining News

Vedanta news: Vedanta to spin off, list five more commodities businesses to unlock value


Indian metals-to-oils conglomerate Vedanta has announced plans to demerge its business units into independent ‘pure play’ companies to unlock value, get investments, the company said in a statement on Friday.

“By demerging our business units, we believe that will unlock value and potential for faster growth in each vertical. While they all come under the larger umbrella of natural resources, each has its own market, demand and supply trends, and potential to deploy technology to raise productivity,” said Anil Agarwal, Chairman of Vedanta.

The company said Vedanta Aluminium, Vedanta Oil & Gas, Vedanta Power, Vedanta Steel and Ferrous Metals, Vedanta Base Metals and Vedanta Limited are the new proposed entities.

Earlier in the day, Hindustan Zinc said it plans to create separate entities for its zinc, lead, silver and recycling businesses to unlock “potential value” and will appoint external advisors to review its corporate structure.

Vedanta Chairman Anil Agarwal last month said the company will consider separately listing all or some of its businesses.

Vedanta Resources, the UK-based parent of Vedanta Ltd, has been struggling to raise funds due to rating downgrades and concerns about meeting its debt obligations.Agarwal sought to trim the group’s debt by getting Hindustan Zinc, a unit of Vedanta Ltd, to buy some of the parent group’s zinc assets in a $2.98 billion deal. However, the Indian government, which owns nearly 30% stake in Hindustan Zinc, opposed the move.Vedanta Ltd , a subsidiary of Vedanta Resources, has raised Rs 2,500 crore through the sale of bonds maturing in 18 months at sharply higher rates, Reuters reported on Friday citing bankers.

Shares of Vedanta rose 6.8% on Friday following reports of the split.


Source link