Vedanta demerger details to become clear by March-end, says Agarwal

Metals and mining group Vedanta Restricted will announce the contours of a proposal to spin off key companies into separate listed firms by March-end, chairman Anil Agarwal stated.

Whereas the zinc enterprise is already housed in a listed subsidiary, the plan is to demerge the aluminum, iron and metal, and oil and gasoline companies into standalone, listed entities.

This can ‘unlock worth for all stakeholders’ in addition to create companies which can be positioned higher to capitalise on their distinct market positions and ship long-term development and allow strategic partnerships, he instructed PTI in an interview. It would additionally assist tailor the capital construction and capital allocation insurance policies primarily based on business-specific dynamics, as additionally create distinct funding profiles to draw deeper and broader investor bases.

‘Pure development’

“It (demerger) is a pure factor to do. Market is superb and manufacturing (at totally different divisions of Vedanta) goes nicely. And so we expect having separate firms will create valuation,” he stated. “Possibly in a month and a half, someday earlier than March-end we are going to announce the complete (contours).”

Vedanta Restricted had in November introduced that its board of administrators had shaped a sub-committee to guage a possible spin-off of its aluminum, iron and metal, and oil and gasoline companies into separate listed items. Following the sub-committee’s analysis, the board may additionally contemplate different options resembling strategic partnerships.

The spin-off will lead to three new listed entities with shareholding mirroring that of Vedanta Restricted After this, London-based father or mother Vedanta Assets group will comprise 5 listed entities — Vedanta Restricted, the three newly listed companies and the listed zinc subsidiary, Hindustan Zinc, wherein Vedanta Restricted holds 64.9%.