Hindustan Zinc May Spin Off Its Three Businesses
The strategic objectives for exercise is to unlocking value for stakeholders and creation of businesses.
Vedanta-owned Hindustan Zinc Ltd. may spin off its Zinc & Lead, Silver, and recycling businesses in a bid to unlock potential value.
"The Board of Directors has authorised a committee of directors to evaluate and recommend such options and alternatives to the board of directors," the company said in an exchange filing.
The strategic objectives for exercise are to unlock value for stakeholders and create businesses that are positioned to better capitalise on their distinct market positions and deliver long-term growth, it said.
It will also allow "deeper and broader investor bases" to accelerate sustainability goals focused on waste to wealth, emissions reduction, and strong ESG practices, it added.
It will also enable "appropriate capital structure and capital allocation policies based on business-specific dynamics and sharpen focus on core competencies.
The management will appoint the external advisors to assist in evaluating the options, and together they will update the way forward to the Board of Directors, the company said.
Billionaire Anil Agarwal said that Vedanta is mulling options to carve out businesses from the mining-to-minerals conglomerate to unlock value for investors.
Vedanta will be considering unlocking value at a time when its London-based parent, Vedanta Resources Plc., is looking to refinance $3.8 billion worth of bonds maturing between 2024 and 2026.
S&P Global Ratings revised the rating outlook on Vedanta Resources to negative from stable to "reflect the heightened refinancing risk".
Moody's also lowered the rating to 'Caa2' from 'Caa1' while maintaining a 'negative' outlook, citing the weak liquidity of Vedanta Resources because of large refinancing needs and interest expenses amid tightening financing conditions in global capital markets.
