Vedanta said to be upsizing $2.5bn loan in order to complete delisting of India unit

Anil Agarwal, executive chairman, Vedanta

VEDANTA, which is mining the Gamsberg zinc deposit in South Africa, planned to increase a $2.5bn loan by $250m in order to delist its main India unit, said Bloomberg News citing people familiar with the matter.

The proposed upsizing comes as the London-based mining conglomerate prepares to begin the formal offer, seeking to buy back the shares it doesn’t already own in Vedanta Ltd. The firm won shareholder approval last week to begin the delisting process, said Bloomberg.

Anil Agarwal, chairman of Vedanta, plans to simplify his investments across the company’s structure which was described by Bloomberg News as “multi-tiered”.

Vedanta has interests in zinc, aluminum and oil and gas, all of which have been buffeted by volatile prices and concern about weak demand for metals and hydrocarbons because of the coronavirus pandemic, the newswire said.

The new financing proposal would boost the second tranche of the loan to $1bn, while retaining the first at $1.75bn, the people said. Both parts of the funding rely on dividends from the mining giant’s Hindustan Zinc unit, with the first part relying on existing cash at the unit, and the second on proposed debt sales by Hindustan Zinc, the people said.

Vedanta Resources said last week it was in the process of arranging the financing for the delisting and expects this to be concluded in coming weeks.