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Mining tycoon Anil Agarwal launched the plan to overhaul the business in 2023 after failing to take Vedanta private in 2020.
Vedanta Demerger Approved
Vedanta Receives Approval for Demerger: Vedanta Ltd announced on Thursday that its shareholders and lenders have approved the company’s plan to split into five independent, sector-focused entities.
In a filing with the stock exchange, Vedanta revealed that 99.99% of the shareholders who voted on the demerger scheme supported the move.
Additionally, 99.59% of secured creditors and 99.95% of unsecured creditors also voted in favor of the demerger.
Mining tycoon Anil Agarwal initiated the restructuring plan in 2023, following his unsuccessful attempt to take Vedanta private in 2020.
The demerger will result in the creation of five distinct entities, including Vedanta Ltd, which will focus on base metals.
Under the demerger plan, each Vedanta shareholder will receive one additional share in each of the four newly created companies once the process is completed.
The other entities emerging from the split include:
- Vedanta Aluminium, one of the world’s largest aluminium producers.
- Vedanta Oil & Gas, India’s largest private-sector crude oil producer.
- Vedanta Power, one of India’s top power generation companies.
- Vedanta Iron and Steel, which will have a highly scalable ferrous portfolio.
- Vedanta Limited, housing Hindustan Zinc, the world’s second-largest integrated zinc producer and third-largest silver producer.
Vedanta Ltd will also serve as an incubator for new business ventures, including the company’s technology-focused divisions.
Of Vedanta’s 391.03 crore shares, 324.58 crore (83%) voted on the demerger scheme. Of those votes, all but 42,186 shares were cast in favor of the move.
The demerger is set to create five independent, globally competitive companies focused on mining, aluminium, iron-ore, copper, oil & gas production, and power generation. This restructuring is expected to allow Vedanta’s management to sharpen its focus on each specific business, improving operational efficiency and resource allocation.
The demerger will also allow each company to attract investors, strategic partners, and stakeholders suited to their unique business models, while giving investors the flexibility to choose investments that align with their individual strategies and risk profiles.
Moreover, the demerger is designed to improve capital market access, enabling each entity to unlock its full value.
Currently, Vedanta operates across a diverse portfolio that spans metals, mining, oil and gas, power generation, and other emerging sectors. The proposed demerger is still subject to receiving various statutory, government, and regulatory approvals, including clearance from the National Company Law Tribunal.
