Vedanta Resources repays $100 million to Bank

Vedanta Resources
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Vedanta, a subsidiary of London-headquartered Vedanta Resources (VRL), has repaid $100 million to Standard Chartered Bank and the company’s pledged shares have been released. VRL had also said it had pre-paid all of its maturities due till March 2023 and has de-leveraged by $2 billion in the past 11 months. Thus, it has achieved half of its $4 billion three-year debt reduction commitment in the first year, ahead of its plans for this fiscal.

“The earlier disclosure was made pursuant to facility agreement dated September 8, 2022, entered into between Twin Star Holding, Vedanta Resources and Welter Trading, Standard Chartered Bank (Singapore) for the purpose of availing a facility of an aggregate amount of $100 million. However, the said facility has been repaid and the encumbrance has been released,” the company said in a statement.

VRL is the parent company of Indian mining major Vedanta, which holds a 65% stake in Hindustan Zinc. Earlier on February 28, VRL said it was in the advanced stages to tie up fresh loans of $1 billion from a syndicate of banks. The company, which was also close to finalising $750 million bilateral facilities, is confident of meeting its maturities for the quarter ending June 23.

On March 10, rating agency Moody’s Investor Service downgraded the corporate family rating (CFR) of VRL and senior unsecured bonds issued by the company, over increasing risk in refinancing debts. Prior to that in February, S&P Global Ratings’ said that the liquidity of VRL hinges on its fund-raising abilities and the next few weeks would be crucial for the company.

VRL’s cash needs for the fiscal year ending March 2024 remain large and include cross-border bonds of $400 million and $500 million due in April and May 2023, respectively, and a $1 billion bond maturing in January 2024. The company also has an estimated $1.1 billion in term debt, $450 million of an inter-company loan and an estimated interest bill of at least $600 million, according to the Moody’s report. VRL has paid around $2 billion of its debt in fiscal 2023.

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IE&M Team
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