In an exchange filing released on Monday, Vedanta announced that each of its eligible shareholders will get one share of Vedanta Aluminium Metal Ltd (VAML), one share of Talwandi Sabo Power Ltd (TSPL) and similar consideration in other demerged units, including the oil and gas business, for every share held in Vedanta.
This marks one of the biggest corporate restructurings in India’s metals and mining space, which would see Vedanta’s existing businesses operate as separate listed companies, allowing shareholders to hold a direct stake in distinct sector-specific firms rather than a diversified conglomerate structure.
Demerger to create ‘phenomenal shareholder value’
Earlier last month, Vedanta Chairman Anil Agarwal told the Financial Times that the long-delayed restructuring could create “phenomenal shareholder value”. Agarwal told the FT that the new entities emerging from the conglomerate will have a free hand to grow. A privately held parent company controlled by Agarwal will retain roughly half the shareholding in each of the demerged entities, he added.
The industrialist further said in his interview with the FT that the restructuring could sharply re-rate the group’s market value. “The combined market capitalisation of the five companies would be much higher. People are saying that, comfortably, it should double,” he said. Vedanta’s total market cap currently stands at over Rs 3 lakh crore.
All about Vedanta’s long-awaited demerger
Vedanta’s long-awaited demerger plan received approval from the National Company Law Tribunal (NCLT) in December last year. When Vedanta first announced its demerger plan in 2023, it had proposed splitting its Indian operations into six separately listed companies, including a standalone base metals entity. Over time, the structure was revised. Under the approved scheme, the base metals business will remain within a restructured Vedanta Ltd, while four new listed companies will be carved out.The restructured Vedanta will continue to house the zinc and silver businesses through Hindustan Zinc and is envisaged as an incubator for future ventures. The demerger has seen significant delays, largely due to objections raised by the government.
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