Twin Star holdings seeks up to $501 million via Vedanta share sale

economictimes.indiatimes.com:

Twin Star Holdings, the promoter company of Anil Agarwal-led Vedanta Group, is seeking up to $501 million dollar by selling a 4.3 per cent stake in Vedanta via a share sale. As per reports, the promoter entity will be selling 16 crore Vedanta shares in block deal at an offer price of Rs 258.5 per share on Thursday.

Anil Agarwal-led Vedanta Resources, a London-based company, is taking various measures to pay its debt in the past few months. As of April 1 this year, the outstanding loan balance was $449 million and had to be repaid by December.

This has been extended to December 31, 2024, with interest payable half-yearly. The management had clarified in 2020 that no inter-company loans from VDL to VRL would be used to meet debt obligations after a few VDL equity investors including UK-based hedge fund Kyma Capital raised concerns over the use of Cairn International to borrow $956 million at 7% during a delisting attempt.

By extending inter-company loans, VRL can meet external debt repayments, including a $1 billion bond due in January 2024. In FY24, VRL had a total debt repayment of $4.2 billion, of which $2 billion was already paid in the first quarter.

The remaining $2.2 billion includes principal requirements and interest or intercompany loans, including a $1 billion 13.875% bond due January 2024, which is trading at 88/89 and yielding at 41%. As reported, S&P Global Ratings has warned VRL of a rating action in the absence of a credible refinancing plan by the end of July to maintain the current rating, which is at B-/Stable.