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The natural resources major will raise funds through 250,000 debentures with a face value of ₹100,000 each. These debentures will be unrated, unlisted and redeemable.
This fundraising comes at a time when Vedanta’s parent – Vedanta Resources – is looking at bond repayments of around $3.2 billion between now and March 2025 and reportedly has a huge funding gap.
ET on Thursday reported that Vedanta Resources is in talks with global private credit funds including Cerberus Capital, Bain Capital, Ares SSG Capital and Davidson Kempner to syndicate a $1 billion short-term loan.
The company is simultaneously in talks with bondholders to change repayment timelines and other terms on a sizeable portion of the $3.2 billion bonds. Senior executives proposed prepaying 30% of bonds upfront at recent roadshows with bondholders in Hong Kong, Singapore and London.
In FY23, Vedanta made its highest-ever dividend payout, which is seen as helping its parent with its debt obligations. The Anil Agarwal company also put its iron ore and steel assets on the block earlier this year, as it looks to raise funds.
“We note that debt repayments of $3.6 billion due in FY25, including $2.2 billion bonds, pose a significant funding gap of $ 3.1 billion, equivalent to 29% of Vedanta Ltd’s market cap,” Kotak Institutional Equities said in a recent report. “Refinancing of bonds, given the bleak macros, should be challenging and this could force Vedanta Resources to opt for less desired alternatives,” the brokerage said in a note to its clients.On Thursday, shares of Vedanta ended at their lowest level in more than a year on the NSE.
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