Billionaire Anil Agarwal and his privately held holding company Vedanta Resources will have to spend Rs 7,600 crore additionally for delisting Vedanta Ltd from Indian bourses, according to the Monday share price. The present share price of Vedanta at Rs 130 is about 50 per cent higher compared to the indicative offer price of Rs 87.5 a share given by the promoter group on May 12. The value of the floated stock comes to Rs 23,600 crore as on Monday. The share price has moved up over 100 per cent since its fall in March.
The public holds about 49.5 per cent stake in Vedanta. At the present price of Rs 130 a share, the delisting will be dearer by Rs 7,600 crore, said market analysts. Agarwal-led promoters wanted to buy the shares held by pubic back at a cost of Rs 16,000 crore.
The banking sources say that the promoters have already tied up with lenders to raise capital to finance delisting. "They already secured around Rs 20,000 crore in loans and bonds. They need another Rs 3000-4000 crore to bridge the shortfall," a Mumbai-based banker said.
Kotak Securities said in its report that Vedanta can pay up to Rs 139 per share to delist after completion of its fund-raising. Vedanta said in May that it had received a letter from Vedanta Resources, expressing intention to acquire fully paid-up equity shares of the company that are held by the public. Agarwal's Volcan Investments Ltd had in the past taken London-listed Vedanta Resources also private.
The sources close to delisting process said that the promoter group may revise the offer price close to the delisting. If the offer price is lower compared to the share price, the shareholders may refrain from tendering their shares, said market analysts.
In the January-March quarter, Vedanta wrote off Rs 17,132 crore from books on impairment of assets in oil and gas, copper and iron ore businesses. It resulted in reduction in book value to Rs 89 from Rs 147. Because of the write-off, the company posted Rs 12,083 crore net loss. However, analysts said the lower book value may not necessarily mean a lower delisting price. Because of lower book value, the implied premium would look higher, they said.