Vedanta Seeks to Boost Size of Delisting Loan to $3.25 Billion
A worker uses a forklift to arrange aluminum billets in the cast house unit of the Vedanta Ltd. Aluminium Smelter in Jharuguda district, Odisha, India. (Photographer: Dhiraj Singh/Bloomberg)

Vedanta Seeks to Boost Size of Delisting Loan to $3.25 Billion

Vedanta Resources Ltd. is seeking to increase the size of a planned loan to fund the delisting of its India unit by as much as $500 million, said people familiar with the matter.

The addition of a new part to the deal structure would take the total planned debt sought by the London-based commodity conglomerate to as much as $3.25 billion, the people said, asking not to be identified as the matter is private. The new loan tranche matures in April 2021 and is intended to give Vedanta room to increase a planned offer for its Mumbai listed unit Vedanta Ltd., should it need to do so, the people said.

The move comes as Vedanta Resources prepares to launch the formal offer to buy back the shares it doesn’t already hold of Vedanta Ltd. The proposed delisting is part of Chairman Anil Agarwal’s plan to simplify his investments across a complex multi-tiered corporate structure.

A Vedanta spokesman said the company doesn’t comment on speculation.

Vedanta has interests in zinc, aluminum and oil and gas, and they have been buffeted by volatile prices because of weakened demand amid the pandemic. The proposed increase in the loan is at least the second by the company.

Details of parts of the loan structure are still being negotiated between the company and lead underwriters, the people familiar said.

Vedanta Resources plans to fund future repayments of the deal’s third tranche, which may total as much as $1 billion, from proceeds of rupee bonds sold by Vedanta Ltd.’s cash-rich unit Hindustan Zinc Ltd. Specific details are yet to be finalized.

©2020 Bloomberg L.P.

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