Mining conglomerate Vedanta Ltd received inquires from domestic and international players for its non-core assets, the company's chief financial officer Ajay Goel told analysts in a post-earnings call, reinforcing that the company's intension to dispose the assets remains intact.
The comments were made during the earnings call on January 25, the transcript of the same was made available on January 30.
"The process in terms of due diligence, data rooms, Q&As, site visits is ongoing. We are hopeful to get some offers by this quarter end, and sometime, early next quarter, we see the deal going through. So net-net, our interest in disposition of noncore assets remains intact, de-leveraging both for VEDL," Goel said.
Last year, Vedanta chairman Anil Agarwal flagged that the company aims to complete sale of steel asset by March 2024 amid demerged plans. According to media reports, steelmakers JSW Steel and ArcelorMittal feature among the likely bidders for the iron ore mines and a steel plant of ESL Steel, which is a part of the mining company.
Through the sale of iron ore mines and steel plant, the company looks to repay its lenders amid mounting debt situation, according to reports. During the third quarter, Vedanta restructured its debt worth $3.2 billion and the move was approved by more than 97 percent of its bondholders. As of December 31, 2023, the company's net debt stands at Rs 62,493 crore.
In the October-December quarter, Vedanta posted an 18 percent fall in net profit burdened by finance costs. Its finance costs rose more than 50 percent to Rs 2,417 crore due to higher borrowing costs.
"Our liquidity position has greatly strengthened. We are now in even more comfortable position to manage our existing debt and take long-term monetary decisions," Goel added.
Demerger plans
In September, the company's board approved a plan to split the business into six separately listed companies- aluminium, oil and gas, base metals (mainly copper and zinc international), ferrous (steel and iron ore mining) and power.
The sixth company will be Vedanta itself, which will continue to hold the Hindustan Zinc (HZL) stake and will also fund investments in new sectors such as semi-conductors and display.
"The stock exchange has given their no objection certificate (NOC) for the demerger scheme to SEBI. Currently, we are awaiting SEBI's NOC. Concurrently, we're in talks with creditors for debt allocations," Goel said adding that once SEBI's NOC is secured, the scheme will be submitted to NCLT for an order to conduct members and creditors meeting.
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