Vedanta Announces Shareholders, Creditors February Meet To Decide On Demerger Plans

Vedanta Announces Shareholders, Creditors February Meet To Decide On Demerger Plans

The approval will pave the way for the company's various business verticals to become separate entities

Mining conglomerate Vedanta Ltd has announced that its shareholders and creditors meeting will be held on 18 February to decide on the company’s proposed demerger.

Recently, the Bombay Stock Exchange-listed mining firm had revised its plan, desiring to retain its base metal undertaking within the parent firm.

In its regulatory filing, the company stated, “The meeting of equity shareholders, secured creditors and unsecured creditors of Vedanta Ltd will be held on Tuesday, 18 February in the matter of proposed scheme of arrangement between Vedanta Ltd, Vedanta Aluminium Metal Ltd, Talwandi Sabo Power Ltd, Malco Energy Ltd, Vedanta Base Metals Ltd and Vedanta Iron and Steel Ltd.”

The meeting has been scheduled after the 21 November 2024 order of the Mumbai bench of the National Company Law Tribunal (NCLT).

The company had stated that post-demerger its existing businesses would be structured in the six independent companies Vedanta Aluminium, Vedanta Oil & Gas, Vedanta Power, Vedanta Steel and Ferrous Materials, Vedanta Base Metals, and Vedanta Ltd. However, the plan was later revised.

The company stressed the ongoing search for alternative avenues for restarting the copper business in Thoothukudi, Tamil Nadu, an integral part of the base metals undertaking, was the reason behind the re-think.

The non-implementation of the demerger of base metals undertaking and its retention will not impact the overall value creation for shareholders.

It said, "A demerger of the Vedanta Base Metals undertaking may be considered at a stage when the base metals business evolves and matures to realize the full value potential of such demerger for shareholders.”

Earlier, Anil Agarwal, Chairman of Vedanta said the proposed demerger of the company's diverse verticals, representing over 15 commodities, would progress from asset managers to asset owners.

As the company transitions, it consolidates and strengthens its asset base to emerge as a world leader in each vertical.

After the lenders approved, the diversified natural resources company had sought a demerger, hoping to complete the process by the end of this fiscal year.

It will simplify the corporate structure by creating independent businesses and offer global investors direct investment opportunities. It will also allow individual units to pursue strategic agendas freely and align with customers, investment cycles and markets.