Overview
- Vedanta’s board approved the demerger to take effect on Friday, May 1, with that date also serving as the record date to determine who receives shares in the new companies.
- Under a 1:1 swap, investors will be allotted one share each in Vedanta Aluminium Metal, Talwandi Sabo Power (to be renamed Vedanta Power), Malco Energy (to be renamed Vedanta Oil & Gas) and Vedanta Iron and Steel, alongside the existing Vedanta Ltd.
- Because May 1 is a market holiday in Maharashtra, April 29 is the last day to buy the stock with eligibility, and exchanges plan a special pre-open session on April 30 to discover the ex-demerger price before regular trading begins.
- As part of aligning assets and debt with the new aluminium arm, Vedanta will transfer its BALCO stake and aluminium-linked non-convertible debentures to Vedanta Aluminium Metal, with the BALCO deal structured via compulsorily convertible debentures at arm’s length.
- Analysts expect the four spin-offs to list in roughly four to eight weeks subject to approvals, while indices and derivatives will adjust in stages with Vedanta staying in the Nifty Next 50 and the new entities reflected only after they begin trading.