NEW DELHI: Amid speculations that US-based boutique investment firm GQG Partners is in talks to buy a $1 billion stake in debt-laden Vedanta, Finsider International Co, a promoter company of Vedanta, sold a 1.76% stake for nearly Rs 1,737.2 crore via an open market transaction on Thursday.
However, it was not immediately known to whom the shares were sold. Earlier exchanged data showed that about 3% equity of the mining company worth Rs 2,600 crore changed hands on Thursday.
Finsider, which held a 4.4% stake in the mining company, sold 6.55 crore shares at Rs 265.14 apiece, BSE data showed. This is a 5.2% discount to Vedanta Ltd’s closing price on Wednesday. The stock closed 4.2% lower at Rs 267.95 on Thursday.
UK-based Vedanta Resources held a 63.72% stake in Vedanta Ltd through its six subsidiaries as of December 31, 2023, showed BSE data. The stake sale by Vedanta comes at a time when the Anil Agarwal-led company is taking big measures to trim down its debt which has ballooned to alarming levels in recent years.
At the end of December quarter, Vedanta’s consolidated net debt stood at Rs 62,493 crore ($7.5 billion). The promoter of the come has been servicing its debt through refinancing and dividends receipts from the highly profitable Indian subsidiary. Chairman Anil Agarwal had also announced plans was to split the company into six entities. GQG, led by Rajiv Jain, was the first strategic investor in Adani group in the aftermath of Hindenburg Research.
Despite Vedanta’s efforts and Agarwal’s assurance that the company would meet its debt obligations, S&P Global Ratings had recently downgraded the rating of Vedanta Resources’ long-term issuer credit rating and long-term issue ratings on the company’s bonds due January 2024, August 2024, and March 2025 to ‘CC’ from ‘CCC’. S&P Global also expressed concerns about the “likelihood of a conventional default”.