Anil Agarwal-controlled Vedanta Resources will issue $400 million in notes to an entity under Oaktree Capital Group to meet the liquidity needs. The notes will be partly secured by shares in its India listed unit, Vedanta.
"A subscription agreement dated December 23, 2020, has been entered into between Vedanta Holdings Mauritius II Limited (Issuer), Finsider International Company Limited (FICL), Vedanta Resources Limited (VRL), Westglobe Limited (Westglobe) and OCM VErde XI Investment Pte. Ltd. (OCM). Under the subscription agreement, the Issuer shall issue $400,000,000 notes of nominal value of $1 (notes) in favour of OCM, subject to certain conditions," as per the exchange filings from Vedanta and the US hedge fund.
This development came days after Vedanta Resources raised its stake in Mumbai-listed unit Vedanta Ltd to 55.11 per cent by buying from open market shares worth Rs 2,959 crore. It bought 18.5 crore shares at a price of Rs 159.94 per share, raising stake in Vedanta Ltd to 55.11 per cent from the current 50.13 per cent. The move comes weeks after the firm's failed attempt to delist Vedanta Ltd from Indian stock exchanges. The delisting failed due to insufficient number of shares being offered in the buyback proposal of VRL.
Earlier on December 10, London-headquartered Vedanta Resources sold $1 billion bonds at 13.875 per cent, one of the highest yields for a dollar bond in Asia this year. The bonds were issued by Vedanta Resources Finance II plc, a wholly-owned indirect subsidiary of the company, and the said proceed intends to be used to finance a buyback offer for $670 million of notes maturing in June 2021. Any remaining proceeds will be used to service its existing debt and for acquisition of equity shares of its Indian subsidiaries.
Barclays, Citigroup, Credit Suisse, DBS Bank Ltd, Deutsche Bank, JP Morgan and Standard Chartered Bank are acting as joint global coordinators, joint lead managers and joint book runners.