In an exchange filing today the metal and mining major said that Vedanta Resources Limited and its wholly owned step down subsidiaries namely, Vedanta Holdings Mauritius Limited, and Vedanta Holdings Mauritius II Limited will acquire the fully paid-up equity shares of the company.
Vedanta’s main businesses include zinc, aluminum and oil and gas, all of which have been hit by a slump in demand due to the coronavirus pandemic.
Anil Agarwal-led Vedanta Limited has received in-principle approval from the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) to delist shares from the exchanges. In an exchange filing today the metal and mining major said that Vedanta Resources Limited and its wholly owned step down subsidiaries namely, Vedanta Holdings Mauritius Limited, and Vedanta Holdings Mauritius II Limited will acquire the fully paid-up equity shares of the company. With this the company has initiated the reverse book-building process which will see bids opening from October 5. Vedanta’s shares are currently trading at Rs 140 per share on Tuesday.
In the public announcement, the company said that till October 1, it will be sending out Letter of Offer/ Bid Forms to public shareholders. The bidding for the shares will begin from October 5 and will remain open for shareholders till October 9. During this window, public shareholders will submit their bids for the delisting of shares. Currently, the promoter group holds 176 crore shares, excluding the American Depositary Shares aggregating to 50.14% of the company’s shares. According to the schedule provided by Vedanta Limited, the last date for announcement of counter offer has been set at October 13. Further, on October 16, the discovered price or the exit price will be announced and whether the acquirers of the shares accept the same. In case of acceptance of the offer, on October 23, the company will proceed to pay the public shareholders.
For Anil Agarwal’s Vedanta to go private the acquirers will need to take their shareholding up to 90%. The parent company of Vedanta Limited earlier last month managed to secure $3.15 billion in funds. Vedanta Resources secured a bank commitment of $1.75 billion and recently raised senior secured bonds of $1.4 billion, maturing in three years with a 13% coupon. “For delisting, the promoter needs to acquire 45.9% public holding in India or 1,704 million shares and $3.15 billion implies the ability to pay at least Rs139/share,” Kotak Securities said last month. However, Vedanta Limited shareholding at the end of the June quarter has public shareholding at 49.49%.
The current market price of the stock is at Rs 140 per share which is at a 60% premium to the delisting offer of Rs 87.50 per share that the billionaire Anil Agarwal had unveiled earlier this year.