Vedanta Resources, the first Indian company to have gained a premium listing on the London Stock Exchange, is expected to be delisted on October 1, after minority investors agreed to sell their shares to the family investment vehicle of its executive chairman Anil Agarwal.
On Monday, Volcan Investments Limited., the holding company wholly owned by Mr. Agarwal’s discretionary trust, said it now held or had received acceptances of its offer on 92.31% of Vedanta Resources share capital and the cash offer had now become unconditional in all respects. The offer remains open for acceptances until further notice.
The effort to take Vedanta Resources private has moved rapidly from early July, when the plan to acquire the 33.47% that it did not own was announced by Volcan Investments, valuing the company at £2.325 billion ($3.03 billion). The all-cash offer of £8.25 a share marked a 28% premium on the closing price of Vedanta Resources on the Friday before the offer was announced. The offer was recommended by an independent committee of the company which described the offer as an “attractive” one that secured “delivery of future value today in cash, whilst providing shareholders with the ability, should they choose, to retain exposure to the Vedanta Group growth story by reinvesting all or part of their offer proceeds in Vedanta Limited.”
Mr. Agarwal has described the move to take the company private as a “natural progression” for the company, and that while a London listing had served the company “extremely well” since 2003, it was no longer necessary for the company to achieve its “strategic objectives.” Since the announcement there has been considerable market speculation as to whether the delisting was a precursor to further actions, including a move towards consolidation within the sector.
Vedanta Resources’ share price has soared over its listing period – from around £3.70 a share in December 2003. However, the company has not been without controversy in the U.K., with a number of investors, including the Church of England, selling their stakes over human rights and ethical considerations over the intervening years. Earlier this year, Britain’s opposition Labour Party called for Vedanta Resources to be delisted from the London Stock Exchange to “remove its cloak of respectability,” following the killing of protestors in police firing in Thoothukudi in May.
An independent judicial committee is set to decide whether Vedanta Ltd. will be able to re-open the smelter in Tamil Nadu, following the announcement of the permanent closure of the plant by the state government.
Vedanta is also facing legal challenges in Britain. Zambian villagers last year won the right to sue Vedanta in London, though the company is appealing this ruling.
Last week, Vedanta Resources said that Srinivasan Venkatakrishnan, who had headed AngloGold Ashanti, would be taking over as CEO, from interim head Kuldip Kaura, who had stood in after the departure of Tom Albanese in 2017.
