Vedanta’s demerger plans may face hurdles from shareholders: Credit Sights report
Vedanta Ltd’s planned demerger of its businesses could face major hurdles from minority shareholders and creditors, said Credit Sights, a FitchSolutions Company, in its report. “We maintain our view that VEDL's (Vedanta Ltd's) planned demerger of its other businesses could face major hurdles from minority shareholders and/or creditors, which may delay or derail the deal.
There have been few updates on the demerger progress ever since it was announced in September 2023," said the Credit Sights report. ALSO READ: Vedanta to appeal against Sebi order to pay ₹77.62 crore to Cairn In September 2023, the mining conglomerate had announced its demerger plans for its five key businesses, including aluminium, oil and gas, and steel.
“In the first place, we felt that a demerger of VEDL will not fundamentally and significantly address VRL's (Vedanta Resources Ltd) ability to service its debt obligations, and will in fact complicate VRL's corporate structure, something the company has spent a decade simplifying," the report also said. “We acknowledge the demerger could improve VEDL's overall equity fundraising ability and valuations and simplify price discovery.
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