Vedanta fixes May 1 as demerger date, shareholders to receive shares in each resulting company

The move marks a key milestone in the company’s restructuring plan, under which shareholders of Vedanta Ltd will receive one share in each resulting company for every one Vedanta share held on the record date.

Demerger to carve out group’s businesses across sectors into focused entities

The demerger will carve out the group’s aluminium, power, oil and gas, and iron ore and steel businesses into separately focused entities. Vedanta has said the restructuring is aimed at simplifying its corporate structure, sharpening management focus, and allowing investors to value each business independently.

Talwandi Sabo Power will be renamed Vedanta Power, while Malco Energy will become Vedanta Oil & Gas as part of the reorganisation.

The board has also approved the transfer of Vedanta’s shareholding in Bharat Aluminium Co Ltd (BALCO) to Vedanta Aluminium Metal Ltd as part of the internal realignment ahead of the split.

Non-convertible debentures linked to the aluminium business will also move to the new aluminium entity. Vedanta Aluminium Metal will issue compulsorily convertible debentures as consideration for the BALCO stake transfer.

BALCO accounted for Rs 15,909 crore of turnover in FY25, or about 10 per cent of Vedanta’s consolidated turnover, while its net worth stood at Rs 12,088 crore, equivalent to 39 per cent of the group’s consolidated net worth.

Vedanta first announced the demerger plan as part of efforts to unlock value from its portfolio spanning metals, mining, hydrocarbons and power generation. The company has maintained that separate entities would provide clearer earnings visibility and enable each business to pursue independent growth strategies aligned to their own investment cycles and market conditions.

Once completed, investors in Vedanta Ltd will gain direct exposure to each of the newly separated businesses rather than holding them through a single diversified parent.

Scheme of arrangement for demerger 

•    Vedanta Aluminium Metal Limited (VAML): 1 equity share (Rs 1 face value) for every 1 Vedanta share held 
•    Talwandi Sabo Power Limited (to be renamed Vedanta Power Limited): 1 equity share (Rs 10 face value) for every 1 Vedanta share held 
•    Malco Energy Limited (to be renamed Vedanta Oil & Gas Limited): 1 equity share (Rs 1 face value) for every 1 Vedanta share held 
•    Vedanta Iron and Steel Limited (VISL): 1 equity share (Rs 1 face value) for every 1 Vedanta share held