Lower commodity prices have weakened Vedanta's cash flows and financial ratios and lowered the headroom under its financial covenants, resulting in a "less than adequate" liquidity assessment. We believe a proposed merger of Cairn India and Vedanta Ltd. could support Vedanta's financial metrics; however, uncertainty remains on the completion of the deal. We are placing our 'BB-' foreign currency long-term corporate credit rating on Vedanta and our 'BB-' long-term issue ratings on the London-headquartered company's guaranteed notes and loans on CreditWatch with negative implications. On Sept. 9, 2015, Standard&Poor's Ratings Services placed its 'BB-' foreign currency long-term corporate credit rating on Vedanta Resources PLC (Vedanta) and the 'BB-' long-term issue ratings on the company's guaranteed notes and loans
