New Delhi: Billionaire Anil Agarwal on Thursday outlined a bold vision to double the size of his mining conglomerate Vedanta, driven by a ‘3D’ strategy focused on demerger, diversification, and deleveraging.
Addressing shareholders at the company’s 60th annual general meeting (AGM), he said the company is confident that the demerger will happen before September and each of the demerged businesses has potential to grow into a $ 100-billion enterprise.
“Our 3D strategy, demerger, diversification and deleveraging, will enable us to double in size and unlock maximum value for our stakeholders,” he said.
The Vedanta Ltd chairman also said the company is in advanced stages of restructuring its business.
“Our demerger proposal has received support from over 99.5 per cent of shareholders and creditors. This is a vote of confidence like no other.
“Once implemented, for every share held in Vedanta Ltd, each shareholder will receive one share in each of the four demerged companies,” he explained. Replying to a shareholder during the AGM, Agarwal said that the company is confident that the demerger will happen before September.
The annual general meeting has come a day after US short seller Viceroy Research on Wednesday called Agarwal-led British firm Vedanta Resources a “parasite” that is “systematically draining” its Indian unit, an allegation which the group called as “selective misinformation and baseless” aimed at discrediting it.
On the short seller report, the chairman said, “As far this report is concerned, we are so transparent. We remain transparent and believe in disclosures and this is our strength. This (report) is motivated and we will deal with it.”
Vedanta Resources Ltd CEO Deshnee Naidoo further explained that “As we have said yesterday and today, there is no new information in the report that we have not voluntarily shared with you previously. And as chairman said, it’s all about the disclosures, and the transparency that we’ve maintained with you over the decades. “The authors of the report have compiled only part information filled with gross inaccuracies, which you have also discerned as part of this meeting.”
The company is set to realise significant earnings growth ahead with both forward and backward integration. Projects in aluminium and zinc will boost its profitability. All businesses of the company are set for expansion and will deliver even greater value once all of this is implemented, she explained.
During AGM, Agarwal further said that Vedanta has also plans to enter into partnerships with 1,000 startups in the technology space. “This will make Vedanta one of the largest innovation hubs, nurturing the next generation of technology champions who will shape the future of Bharat,” he said.
The demerger of the company will create separate entities focused on aluminium, oil and gas, power, iron and steel, and zinc and silver. Each Vedanta shareholder will receive shares in the new companies.
Once the demerger is completed, shareholders will receive shares in each of the four newly demerged entities. Each business will have its own strategic focus, investor base, and growth path, with the potential to grow into 100 billion dollar enterprises. “Each business will get a renewed focus, new investors, and a unique opportunity to achieve its full potential,” the chairman stressed.
He further said that with India’s geology being comparable to resource-rich nations like Canada and Australia but only 25 per cent explored, the time was ripe for accelerated growth in the critical minerals sector.
The company has bagged 10 critical mineral blocks across India, one of the largest by any private sector company.
Vedanta Ltd, a subsidiary of Vedanta Resources Ltd, is one of the world’s leading natural resources, critical minerals, energy and technology companies spanning across countries like India, South Africa, Namibia, Liberia, UAE and Saudi Arabia, with operations in oil and gas, zinc, lead, silver, copper, iron ore, steel, nickel, aluminium, power and glass substrate and foraying into electronics and display glass manufacturing.