Bharat Petroleum Corporation BPCL: Vedanta’s founder and chairman Anil Agarwal said that if the Bharat Petroleum Corporation (BPCL) deal happens, then there will be no funding from Vedanta for this. Giving this information during a conversation with CNBC-TV18 on February 9, he said, Vedanta follows disciplined capital allocation policy.
No plans to delist Vedanta
The company does not think it is necessary to demerge it as “we are a strong company,” Agarwal said. He said there are no plans to delist Vedanta at the moment. Vedanta is comfortable with debt of $12.5 billion, which has a debt-equity ratio of 1.2-1.3 times.
Agarwal said there are no plans to fund Vedanta through the balance sheet of Vedanta Resources. “Vedanta will not be merged with the parent company,” he said.
Government will have to wait and wait to sell stake in BPCL, companies withdrew from initial bids
What did Agarwal say on Hindustan Zinc?
On Hindustan Zinc, Agarwal said that if the government wants to sell, then the company can buy up to 5 percent stake in it. If the central government gives permission, the company will consider buying more stake, he said.
He said, “There is enough demand in the market for the remaining share of Hindustan Zinc. The choice to buy the remaining stake in Hindustan Zinc will depend on its valuation and regulatory approvals.
Agarwal told the channel that he has no plans to increase his stake from the current level of promoter holdings.
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What is the progress on BPCL
Vedanta, in a statement on February 8, said it plans to form a fund with a strategic investor to finance the possible acquisition of state-owned BPCL.
Vedanta said in a statement that its bid for BPCL is currently in the EOI stage and if the deal is successful, the company can take over the management of the purchased business. The business will be acquired on a suitable profit sharing arrangement or a management fee model, the statement said. A dedicated fund will be created with a strategic investor to support potential investments beyond Vedanta’s balance sheet.
No plan to change corporate structure
The company told regulators on February 8 that it has rejected plans to change its corporate structure after completing its reorganization review. The company has come to the conclusion that its existing structure is suitable.
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