Vedanta Ltd's Board of Directors has approved a Rs 2,500 crore capital raise via the issuance of non-convertible debentures (NCDs) in one or more tranches. Up to 2,50,000 secured, unrated, unlisted, redeemable NCDs with face values of Rs 1 lakh each will be issued by the company.
"The duly authorized Committee of Directors at its meeting held Sept 22 considered and approved for raising, on a private placement basis, up to 2,50,000 Secured, Unrated, Unlisted, Redeemable, NonConvertible Debentures of face value Rs 1,00,000 each aggregating up to Rs 2,500 crore in one or more tranches," the company said in an exchange filing.
According to the company, fundraising is part of its routine refinancing, done in the normal course of business.
Vedanta has two separate term loans of Rs 300 crore and Rs 1000 crore due on November 14, 2023, and on March 31, 2024, respectively. The fresh issues of bonds likely meet the capex requirements or repay these terms loans.
The fundraise also comes at a time when its parent Vedanta Resources is working round the clock on the redemption of the upcoming $3.2 billion offshore bonds.
Vedanta Resources has $1 billion in bonds due in January 2024 at 13.875%, $1 billion in bonds due in August 2024 at 6.125%, and $1.2 billion in bonds due in March 2025 at 8.95%.
It proposed extending the bonds' tenure by three years at a bondholders' meeting organised by Standard Chartered Bank and JP Morgan between September 11 and 15 in Singapore and Hong Kong, respectively, ET reported earlier.
In August, S&P Global Ratings downgraded Vedanta Resources' outlook to negative, raising concerns about the company's ability to refinance its upcoming liabilities. It had previously warned of a possible downgrade of the offshore bonds if it did not adequately compensate bondholders.