Positioning Vedanta for the future
Creating pure play business units capable of independent investment across a broad array of natural resources, renewables, semiconductors, display & technology sectors.
Vedanta reorganisation
On the 29th of September Volcan Investments Limited, the parent company of Vedanta Resources Limited and Vedanta Limited, announced that it is renaming itself as Vedanta Incorporated. Additionally, Vedanta is pleased to announce a significant reshaping of its portfolio which will create dedicated, pure play world-class business units capable of independent, direct investment across a broad array of natural resources, renewables, semiconductors, display, and technology sectors.
Following the completion of this undertaking, achieved through a series of demergers from the current conglomerate structure, Vedanta will be the sole or majority owner of 17 investment vehicles. In turn, this portfolio reshaping will unlock significant stakeholder value across the entire breadth of Vedanta's business interests, ensure full capitalisation of the latent potential of our asset base, increase balance sheet optionality for each of the business units individually and future-proof the organisation for decades to come.
Following the completion of this undertaking, achieved through a series of demergers from the current conglomerate structure, Vedanta will be the sole or majority owner of 17 investment vehicles. In turn, this portfolio reshaping will unlock significant stakeholder value across the entire breadth of Vedanta's business interests, ensure full capitalisation of the latent potential of our asset base, increase balance sheet optionality for each of the business units individually and future-proof the organisation for decades to come.
The Vedanta Group has a unique portfolio of assets among Indian and global companies with metals and minerals - zinc, silver, lead, aluminium, chromium, copper, nickel; oil and gas; a traditional ferrous vertical including iron ore and steel; power & transmissions, including thermal and renewable energy; digital and is now foraying into manufacturing of semiconductors and display glass. Once demerged, each independent entity will have greater freedom to grow to its potential and true value via an independent management, capital allocation and niche strategies for growth. It will also give global and Indian investors potential to invest in their preferred vertical, broadening the investor base for Vedanta assets.
Group organisation structures
- Business Listed
- Technology
- Energy Transition
- Natural Resources
1. Valuation: Capital markets perceive a capital allocation risk which results in a discount to intrinsic fair value.
2. Liquidity and growth capital: Perceived debt limits; equity capital market access is relatively restricted.
3. Investor Universe: Investors presented with a diverse portfolio of non-synergistic assets.
4. Management: Centralized management with different financial profile and businesses competing for capital investments.
- Business Listed
- Technology
- Energy Transition
- Natural Resources
- Strategic Review
1. Vedanta will be the sole or majority owner of 17 investments vehicles possessing global scale and best-in-class cost position.
2. Entities created will have independent capital structures and better ability to attract direct investment for growth and pursuit of strategic agenda.
3. Each entity better able to attract the appropriate universe of investors and strategic partners. With better understanding of each vertical by the sell-side and investor communities.
4. Independent, skilled management teams with benefits of equity exposure to be able to recruit and retain top talent.
Glossary:
HZL - Hindustan Zinc Limited, VZI - Vedanta Zinc International, TSPL - Talwandi Sabo Power Limited, KCM - Konkola Copper Mine, SPTL - Sterlite Power & Transmission Limited, STL - Sterlite Technologies Limited, IOB - Iron Ore Business, ESL - Electro Steel Limited, WCL - Western Cluster Limited (Liberia)
Links to Relevant Files
Vedanta Limited Reorganisation Announcement Vedanta Limited Demerger Announcement