Bulletin: Vedanta Resources' Increased Subsidiary Stake Should Improve Liquidity

SINGAPORE (S&P Global Ratings) April 13, 2021--Vedanta Resources Ltd.'s liquidity should improve now that the company's stake in subsidiary Vedanta Ltd. (VEDL) is likely to increase to 65% from 55% following the completion of an open offer. S&P Global Ratings continues to believe that the increase in ownership will improve Vedanta Resources' access to the cash flows of its operating subsidiaries by reducing dividend leakage, and could enhance its refinancing ability. In addition, some surplus cash from the funding for the open offer has materially reduced refinancing risk for the India-based commodity conglomerate for fiscal 2022 (year ending March 2022). Vedanta Resources is likely to spend about US$1.2 billion for the additional 10% stake purchase, following the just completed open

...April 13, 2021 SINGAPORE (S&P Global Ratings) April 13, 2021--Vedanta Resources Ltd.'s liquidity should improve now that the company's stake in subsidiary Vedanta Ltd. (VEDL) is likely to increase to 65% from 55% following the completion of an open offer. S&P Global Ratings continues to believe that the increase in ownership will improve Vedanta Resources' access to the cash flows of its operating subsidiaries by reducing dividend leakage, and could enhance its refinancing ability. In addition, some surplus cash from the funding for the open offer has materially reduced refinancing risk for the India-based commodity conglomerate for fiscal 2022 (year ending March 2022). Vedanta Resources is likely to spend about US$1.2 billion for the additional 10% stake purchase, following the just completed open offer where the company had bid for an up to 17.5% stake in VEDL. Vedanta Resources has secured about US$2.15 billion to fund the open offer, through US$1.2 billion of senior unsecured bonds,...

Bulletin