MAC: Mines and Communities

Vedanta Resources announces US$1.7 billion bond offering

Published by MAC on 2013-06-03
Source: Business Standard, Mining.com, Bloomberg (2013-05-26)

The vultures who have picked over and coughed out the bones of this bond include Barclays, Royal Bank of Scotland, Standard Chartered and  JP Morgan.

Vedanta Resources Plc announces pricing for $1.7 bn bond

Business Standard

26 May 2013

This would be Vedanta's fourth successful bond transaction; intends to use the proceeds to refinance a portion of its obligations Vedanta Resources PIc today announced the pricing of its $1.7 billion (Rs 9,500 crore) bond offering.

The bonds are being offered and sold in two tranches, consisting of $1.2 billion aggregate principal amount of 6% due January 2019 and $500 million aggregate principal amount of 7.125% bonds due May 2023.

This is a landmark transaction for Vedanta, and Vedanta believes this represents one of the largest corporate high yield bond issuances out of Asia ex-Japan, said a company release.

This is Vedanta's fourth successful bond transaction. It intends to use the proceeds of the offering to refinance a portion of its obligations under the its existing 2010 term loan facility (that was entered into to partly finance Vedanta's acquisition of a controlling stake in Cairn India), which will result in a cancellation of Vedanta's commitments under a bridge facility, and to pay related fees and expenses and for general corporate purposes.

"It demonstrates the financial strength and global recognition of Vedanta Group as a major natural resources corporate. It is our fourth bond transaction and each time we have been met with increasingly overwhelming response by investors," said Anil Agarwal, chairman of Vedanta Resources pIc.

The bonds are being offered and sold in a private offering to qualified institutional buyers under Rule 144A of the Securities Act of 1933, as amended ("Securities Act"), and outside the United States under Regulation S under the Securities Act. The offering is expected to close on June 3, 2013, subject to customary closing conditions.

Bank of America Merrill Lynch, Barclays, Citigroup, J.P. Morgan, The Royal Bank of Scotland and Standard Chartered Bank are acting as Joint Global Coordinators, Joint Lead Managers and Joint Bookrunners and Deutsche Bank is acting as Joint Bookrunner.'


Vedanta raises $1.7bn, India's largest ever offshore bond sale

Cecilia Jamasmie

Mining.com

24 May 2013

Diversified group Vedanta Resources announced it has sold India's largest ever offshore bond, raising $1.7 billion from mostly US and European investors.

The bonds are being offered and sold in two tranches, consisting of $1.2 billion aggregate principal amount of 6% due January 2019 and $500 million aggregate principal amount of 7.125% bonds due May 2023.

This is a landmark transaction for Vedanta, which is joining domestic peers in catching the flood of US dollars being unleashed by central banks.

The amount will be used to partly repay the debt taken for its Cairn India acquisition.

Indian groups have already almost doubled the record full-year amount of debt raised offshore in 2011 when companies raised a total of $3.3bn, according to Financial Times (subs. required). Vedanta issued the previous record deal, which was $1.65bn, in that year.

Bank of America Merrill Lynch, Barclays, Citigroup, J P Morgan, The Royal Bank of Scotland and Standard Chartered Bank are acting as joint global coordinators, joint lead managers and joint bookrunners and Deutsche Bank are acting as joint bookrunners for the issue.

The bonds, the company said, are expected on the closing date to be rated "Ba3" by Moody's, "BB" by S&P and "BB" by Fitch.

The company, with most of its operations in India, had reported a 21% increase in its core profits at $4.9 billion for the year ended March, 2013.

Vedanta also has operations in Zambia, Namibia, South Africa, Liberia, Ireland and Australia. The group is primarily engaged in copper, zinc, silver, aluminium, iron ore and power business.


Konkola Copper Mines to send 2000 workers on the street

Bloomberg

25 May 2013

Vedanta Resources Plc (VED)'s Zambian unit plans to cut 24 percent of its workforce after costs rose and the copper price dropped.

Konkola Copper Mines Plc will reduce the total number of employees at its operations in Africa's biggest producer of the metal by 2,000 from 8,263, the Chingola, Zambia-based company said in an e-mailed statement.

Copper for three-month delivery has slumped 8.3 percent to $7,273 a metric ton over the past 12 months in London trading. KCM, as the company is known, said labor and electricity, its two key costs, have been "increasing constantly and substantially."

"KCM needs to make business changes to remain economically viable," it said. "Regrettably, this means reducing staff numbers as many of the upgrade and expansion projects come to an end."

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