Vedanta Resources Repays $800 Million Debt To Standard Chartered: Report
The move aims at allaying concerns about the company's liquidity amid rising interest rates and mounting pressure on borrowers with high debt.
Vedanta Resources Ltd., owned by billionaire Anil Agarwal, announced that it has paid off loans worth $800 million taken from Standard Chartered Bank in London and Hong Kong, reported Bloomberg. The move aims at allaying concerns about the company's liquidity amid rising interest rates and mounting pressure on borrowers with high debt, the report added.
The London-based company in an exchange filing said that it repaid three facilities obtained from Standard Chartered Bank in London and Hong Kong, thereby releasing the encumbrances on the shares of its subsidiary, Vedanta Ltd, the report said.
Vedanta Resources had previously relied on hefty dividends from its Indian units, taking up record amounts last fiscal year to meet its short-term liabilities. With its dollar notes due this month and a larger debt coming due in 2024 when around $2 billion of bonds will mature, the focus is now on how the mining giant will service these obligations. In April, the company stated that it had already paid off all loans and bonds due last month, thereby reducing its gross debt to $6.8 billion.
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Last month in an interview with PTI, Mining mogul Anil Agarwal said his Vedanta group has ample cash flow to service all its debt repayment obligations and that it aims to become a "net zero debt company" in 2-3 years.
He said. "Total debt in the company is $13 billion. And we have a profit this year of $7 billion. Next year our revenue would be $30 billion and we will have $9 billion profit" across the group.
Vedanta Resources Ltd, the parent company of Mumbai-listed mining giant Vedanta Ltd, said in April that it has paid all its maturing loans and bonds due this month to reduce its gross debt by a further $1 billion.
"Yes 100 per cent within a maximum of 2-3 years time, we will be zero debt company. But we have to do a lot in India. We have to create semiconductors (factory), we have to create display glass (factory), we have to expand our copper (business), we have to expand our aluminum (business), we have to expand oil and gas (operations), this is important. At that point, we might have to take debt (but) we have no plan (as of now)," he said.