Vedanta Hindustan Zinc OFS: Anil Agarwal-led company sets floor price at Rs 486 per share | Market News
Vedanta, the promoter of Hindustan Zinc Ltd (HZL), said in a statement that its board of directors has approved the sale of up to 1,400,000,000 equity shares of Hindustan Zinc Ltd, representing 3.31% of the equity interest, in the offer for sale.
Vedanta sets minimum price of Rs 486 per share for HZL OFS and sells up to 3.31 percent of the shares (Image: Vedanta)
New Delhi: Mining major Vedanta will sell up to 3.31 percent of its stake in Hindustan Zinc Ltd (HZL) through an offer for sale (OFS) at a floor price of Rs 486 per share from August 16 to 19, a regulatory notification said.
Vedanta, the promoter of Hindustan Zinc Ltd (HZL), said in a statement that its board of directors has approved the sale of up to 1,400,000,000 equity shares of Hindustan Zinc Ltd, representing 3.31% of the equity interest, in the offer for sale.
Hindustan Zinc said in a separate filing that Vedanta will sell up to 13.37 crore (13,374,4856) equity shares, representing 3.17 percent of the Company’s equity interest, through the OFS from August 16 to 19, 2024.
The floor price for the OFS was fixed at Rs 486 per share, a discount of more than 15 percent to Wednesday’s closing price of Rs 572.95 on the BSE. HZL shares closed 1.31 percent lower on Wednesday.
At the floor price, the sale of the 3.17 per cent stake will fetch promoter Vedanta Rs 6,498 crore. At the close of trading on Wednesday, the OFS will fetch the promoter Rs 7,663 crore.
Vedanta Limited intends to sell up to 5,144,0329 equity shares, representing 1.22% of the share capital of HZL, exclusively to non-retail investors on August 16 (D-Day), HZL said in the filing.
On August 19, the organizer proposes to sell a further 823,000,000 shares, corresponding to an equity share of 1.95 percent, to private and non-private investors in the event of oversubscription, the filing states.
According to the filing, the OFS will be opened for non-retail investors on Friday. The issue will be opened on Monday, August 19, for retail and non-retail investors who wish to put forward their unallocated bids. “The offer is being made by the seller to, among other things, access funds for growth and expansion purposes and to optimise the capital structure of the company,” Hindustan Zinc said.
Vedanta said it has increased its offer for sale for Hindustan Zinc and will now sell 3.31 percent stake in the company, amounting to up to 140 million shares. Vedanta’s board of directors had on Tuesday approved the sale of up to 110 million shares or 2.60 percent stake in Hindustan Zinc through an offer for sale (OFS).
At a closing price of Rs 572.95 a share on the BSE on Wednesday, Vedanta will raise Rs 8,021 crore from the sale of the 140 million HZL shares.
At the end of the June quarter, Vedanta owned 64.92 percent stake in HZL, while the government held 29.54 percent. Vedanta plans to demerge its aluminium, oil and gas, power, base metals and iron and steel businesses into separate listed companies.
The aim of this spin-off is to reduce the refinancing risks and dependence on dividends of Vedanta Resources Ltd.
As of June 30, 2024, Vedanta’s net debt stood at Rs 61,324 crore.
Vedanta reported a 36.5 percent increase in consolidated net profit to Rs 3,606 crore for the quarter ended June 2024. In the year-ago period, the company had reported a net profit of Rs 2,640 crore. Profit rose to Rs 36,698 crore from Rs 34,279 crore.
Last month, the mining major raised Rs 8,500 crore (over $1 billion) of 19.31 crore equity shares through Qualified Institutions Placement (QIP) at an issue price of Rs 440 per share.
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