Vedanta receives approval from 75% secured creditors for demerger scheme filing

Vedanta’s shares were trading higher by 0.25% at ₹448.30 per share after the company received approval from 75% of its secured creditors for filing a demerger scheme.

Following the approval, Vedanta can seek clearances from the stock exchanges and file the scheme for the proposed demerger with the National Company Law Tribunal (NCLT). The company stated that the demerger will create focused entities that align with the country’s goals for critical minerals, energy security, renewable, and technology sectors. Further, the demerger is also in line with the company’s goals to support the Atmanirbhar Bharat initiative while simplifying the company’s corporate structure.

The demerger will also allow global investors to directly invest in pure-play companies. Following the demerger, Vedanta’s business will be structured into six independent companies: Vedanta Aluminium, Vedanta Oil & Gas, Vedanta Power, Vedanta Steel and Ferrous Metals, Vedanta Base Metals, and Vedanta.

The proposed demerger is planned to be a vertical split in which investors will receive one share of the five newly listed companies for every share of Vedanta. Anil Agarwal, chairman of Vedanta, said that the demerger will result in six independent companies that will unlock shareholder value. The companies will operate independently while maintaining Vedanta’s core values.

"Demerger of our businesses will lead to the creation of 6 strong companies, each a Vedanta in its own right. This will unlock massive value. He said that each demerged entity will chart its course but will follow Vedanta’s core values, enterprising spirit, and global leadership,” he said.

Vedanta has a diversified portfolio of businesses across natural resources. The company has made investments of up to $35 billion within the country to support growth and expansion. The company also has a significant 5-year average accumulated dividend yield of 65%.

The company's shares have risen by nearly 74% since the beginning of the year, and the stock has gained over 62% in the past year.