Vedanta Resources, a UK-based company, said on Wednesday it had secured support from its bondholders to restructure part of its looming debt, easing pressure on bond repayments. Vedanta Ltd., its Indian metal conglomerate subsidiary. The company last year proposed a restructuring of four series of bonds maturing in 2024, 2025 and 2026 to alleviate its large debt load.
With total debt of $6.4 billion, including $4.5 billion due by fiscal 2025, the company had been working to extend its debt maturities and make changes subject to certain conditions and waivers of obligations. The company received approval from approximately 97% to 100% of its bondholders for the four bond series, surpassing the mandatory threshold of 66.67%, according to a regulatory filing.
Vedanta Resources said this significant deal on revised terms would immediately ease the debt repayment burden of the company. This investor approval came despite a downgrade of the company’s ratings by S&P Global Ratings in December. The rating agency suggested that the restructuring plan was driven by a high probability of a traditional default.
Throughout 2020, the company faced several rating downgrades from other rating agencies due to concerns over the group’s outstanding debt. The group’s chairman, Anil Agarwal, has made several attempts to reduce the group’s debt, including defeating his bid to take the company private. The company’s bid to allow its Hindustan Zinc unit to acquire part of its zinc assets to reduce its debt was challenged by the Indian government in 2023. The government holds the largest minority stake in Hindustan Zinc , at 29.54%.
In December, Vedanta Resources raised $1.25 billion from financial institutions for refinancing purposes, which included a new credit facility.
With contributions from Reuters
