Takeover Tycoon Anil Agarwal to delist Vedanta Ltd. from Indian stock exchanges

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(Commercial Representative) Mumbai, 13 May 2020, Wednesday

The sudden delisting of Vedanta from the Indian stock market has been announced by billionaire Anil Agarwal, who has the knack of making sick units profitable in the world's metal-mining industry and is known as a takeover tycoon. Corporate India and investors were surprised when the promoter of Vedanta Resources announced yesterday that it would buy 4.5 per cent of non-promoter's shares in Vedanta at Rs 4.5 per share. Vedanta's delisting offer was made at a premium of 7.5 per cent from the company's share price on May 11, 2020.

Usually companies delist when they are expanding or restructuring and acquired by others or promoters want to increase their holdings.

Following the delisting offer, Vedanta's share price opened at Rs 3.50 against Rs 3.50 today and ended up 1.08 per cent, or 8 paise, at Rs 20.5.

The process of corporate simplification started several years back by the company behind the delisting of Vedanta Ltd. in which Sesar-Sterlite was formed in 2013 by merging Sterlite with Sesagowa. Which was later renamed Vedanta.

Cairn India merged with Vedanta in 2013 and Vedanta Resources was delisted in 2013. The Vedanta Group believes that the delisting of Vedanta is a logical step in the process of simplification and will increase operations and provide financial flexibility in the business seeking capital. The group will be able to maintain the strategy of prioritizing diversified natural resources.

The proposed delisting offer will provide instant opportunities to Vedanta’s public shareholders and give them a chance to get a definite value for their shares in times of increased market turmoil. Earlier, in July 2015, Agarwal had planned to delist Vedanta Resources from the London Stock Exchange and said it was no longer necessary to raise London listing capital. Then, on October 1, the company's shares were bought and successfully delisted.

Vedanta Resources was the first Indian company to be listed in London in 2009 with an offer of ૪ 25 million. It is worth mentioning that companies usually do this when they are expanding or restructuring their delisting or when others through acquisitions or promoters want to buy their holdings. For voluntary delisting the company usually offers the shareholders a premium from the trading at the prevailing price on the exchange.

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