New Delhi: Vedanta Ltd., the Indian metals, mining, and energy conglomerate owned by billionaire Anil Agarwal, will undergo a total makeover, with the demerger of its operations into six distinct companies and the intention to float five of them by FY25.
In order to increase shareholder value, mining giant Vedanta Ltd. announced on Friday to divide five of its core operations, including steel, aluminium, oil and gas, into independent listed businesses.
Anil Agarwal, chairman of Vedanta, commented on the demerger announcement, saying, “In accordance with Vedanta’s culture, each firm will continue to retain a strong commitment to the well-being of our workers, our communities, and our planet. We shall continue to be strong in our commitment to change for the better even as we transition to new business practices.”
Agarwal hopes to unlock value through the reorganisation by forming autonomous “pure play” firms that will attract sizable investments for the development and growth of these enterprises. According to Vedanta Ltd, the required Sebi permission request will be made in October. Volcan Investments Ltd, the primary promoter group company for Agarwal, was also renamed Vedanta Inc. by the group.
The need to streamline the group’s convoluted corporate structure and unlock wealth to pay off debt has become more urgent as a result of rising interest rates across the board and the $2 billion in bonds that will mature in the group’s portfolio next year.
John Slaven, a senior executive at Alcoa and BHP, will lead Vedanta Aluminium. Vibhav Agarwal will be in charge of Vedanta Power. Chris Griffith will be the company’s CEO. Arun Misra will serve as the company’s CEO.
The goal of the new firms is to spend $5 billion over the next ten years to hasten this transformation, and they will continue to be dedicated to reaching net-zero carbon emissions by 2050 and net water positive by 2030. “Through power supply agreements across our group companies, we have already secured 1.8 GW of renewable energy as part of our move to net zero”, the company said in filling.
Hindustan Zinc, a Vedanta affiliate, had earlier today told the stock markets that its board has resolved to consider corporate restructuring options in order to spur development. The restructure is intended to divide the recycling, lead, zinc, and silver companies into independent legal corporations.
Vedanta Ltd will continue to own 65% of Hindustan Zinc Ltd. as well as the brand-new semiconductor and display companies. It is suggested that the full workout be finished in 12 to 15 months.