Vedanta Resources proposed restructuring payments on dollar bonds that come due in the next two years in recent meetings with international investors, people familiar with the plans said.
Indian tycoon Anil Agarwal’s mining company is seeking to pay back a portion of the dollar bonds maturing in 2024 and 2025 in cash, with the remainder of the principal deferred for three years from the original due date, the people said, asking not to be identified because the discussions are confidential.
Company representatives have met investors in Asia and London. The plan would see it repay about half of the January 2024 note’s principal and a smaller proportion on the March 2025 debt, the people said. It’s unclear whether the company is also planning to repay some of the August 2024 bond, which was issued via a different entity.
The terms of the proposal could still change and the plan faces some investor opposition.
“Vedanta is in continuous discussions with its bond holders in the ordinary course including to address upcoming maturities and has been very constructive and productive,” a spokesperson said. “The company is confident that it will have the support of bondholders in all three series of notes for executing an agreed upon exercise.”
With roughly $3 billion of US-currency bonds coming due over the next two years, the miner is on a quest for cash. In a move that’s expected to buttress its finances, subsidiary Vedanta Ltd. is preparing to spin off businesses into several listed entities, Bloomberg reported this week.
Citing the elevated risk of debt restructuring over the next few months, Moody’s Investors Service this week cut Vedanta Resources’ corporate family rating deeper into junk.
Although the January 2024 bond was indicated at 90 cents on the dollar, the other two have slipped below the mark indicative of distress.
The August 2024 note was quoted down 0.5 cents at 63. cents at 8:24m in Hong Hong on Thursday, while that due in March 2025 was down 0.2 cents at 73.5cents, data compiled by Bloomberg showed.
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