Vedanta Resources Signs Facility Agreement Worth $125 Million

Vedanta Resource Ltd. had on Oct. 10 entered into a facility agreement for $125 million.

The company announced on Tuesday that Vedanta Ltd. does not have any shareholding in any of the entities that are parties to the facility agreement, according to an exchange filing.

Vedanta Resources is the borrower in the recently signed $125-million facility agreement, as clarified in an exchange filing. The company is classified as a member of the promoter group of Vedanta Ltd. but holds no direct shareholding in the firm.

Standard Chartered Bank Singapore Ltd. is the arranger, agent, and lender for the agreement, which aims to support Vedanta Resources' funding requirements.

The facility agreement has been entered into for the purpose of funding the cashflow requirements of the VRL Group and transaction expenses contemplated under the facility agreement, in accordance with the terms contained under the facility agreement, the filing said.

The quantification of the restrictions imposed on Vedanta by way of the facility agreement is not ascertainable as they are in the nature of covenants.

Earlier, on Oct. 9, the company had held a board meeting to consider its fourth interim dividend for this financial year. The meeting, which was initially set for Tuesday, had also been postponed due to unforeseen circumstances.

Shares of Vedanta closed 1.83% lower at Rs 490 apiece, compared to a 0.28% decline on the benchmark NSE Nifty 50.

It has risen 116.56% in the last 12 months and 89.46% on a year-to-date basis. The total traded volume in the day stood at 7.41 times its 30-day average. The relative strength index was at 74.48.

Nine out of 15 analysts tracking the company have a "buy" rating on the stock, five recommend a "hold," and one suggests a "sell,"  according to the Bloomberg data. The average of 12-month analyst price targets implies a potential upside of 3.9%.