Rumors circulated in the press Monday that Indian miner Vedanta is spinning off its $20 billion aluminum division, the first of several anticipated Vedanta spin-offs.
India's Economic Times reported Monday Vedanta has hired Morgan Stanley, Credit Suisse and JPMorgan Cazenove to put together a listing plan for Vedanta Aluminum. Bharat Aluminum or Balco, another Vedanta subsidiary, is not part of the spin-off since 49% of Balco is owned by the Indian government.
Vedanta Aluminum is 70% owned by Vedanta Resources and the remainder is owned by Sterlite Industries. Sterlite also owns 51% of Balco.
Quoting "people familiar with the matter," the Times said Vedanta wants to make its Indian business-now under Sterlite-easier for investors to understand. If the plan is approved by shareholders and regulators,Sterlite would become primarily a miner of copper, zinc and lead, while the bulk of the aluminum business will become Vedanta Aluminum, a newly listed company.
The new Vedanta Aluminum would reportedly become the world's fourth-largest aluminum company,behind Russia's Rusal, U.S. company Alcoa, and China's Chalco. Analysts have already valued the company as high as US$20 billion. India is currently the eighth largest producer of primary aluminum in the world.
Last month a Vedanta spokesman told the Economic Times , "The country is set to take a big leap in aluminum export with companies like Vedanta betting big in aluminum production with India being on fourth position among the world's largest aluminum producers from the eighth spot, displacing Norway, Brazil, Australia and Canada in the process. With Vedanta adding huge aluminum production capacities, the county is expected to become one of the largest exports of aluminum with exportable aluminum capacity of 730KT by 2012."
Vedanta has planned $13.5 billion in aluminum capacity expansion projects, which would propel the company from 14th to fourth largest global aluminum producer. The projects would increase total aluminum production capacity fivefold from 500 KT to 2,575 KT.
The UK Independent quoted "a source" Monday who reportedly said that only 10%-15% of the company will be listed in an IPO, raising as much as US$3 billion.
After aluminum, the Independent reported Vedanta's Zambian copper business is expected to be spun-off. Vedanta is reportedly considering up to six substantive spin-offs.
Although Vedanta is allegedly spinning-off companies, Sterlite Industries is still pursuing its appeal of a lower court decision awarding custody of U.S. copper miner Asarco to its former and current parent GrupoMexico. The United Steelworkers union jointly filed an appeal with Sterlite in the 5th Circuit Court of Appeals in New Orleans late last month.
豫公网安备41010502003434号