Vedanta defers restructuring plan on global financial turmoil

Mumbai, Sep 24 (PTI) Diversified metals and mining major
Vedanta Resources has deferred its corporate restructuring
plans in the wake of developments in the global financial
markets and feedback from its investors.

The company, however, said it remains committed to
simplifying its structure in the interest of investors when
the market conditions turn favourable.
"There is no point pursuing the plan to simplify and
streamline our corporate structure in the present (global)
market conditions. However, we will come back at the right
time when the market settles down," Vedanta Resources Chairman
Anil Agarwal told a news channel.
The group is also committed to the 9.8 billion dollar
expansion plan to be undertaken by 2012, he added.
"No capex plan will be postponed. We have 6.5 billion
dollar of cash with us and the company is generating enough
profit at this time. We are comfortable to pursue our
projects," he said.
As per the corporate restructuring plan announced by
Vedanta's Indian subsidiary Sterlite Industries on September
9, the group structure was proposed to be simplified into
three verticals -- copper and zinc-lead, aluminium and energy,
and iron ore.
Under the plan, it was proposed that Sterlite would
demerge its aluminium and energy businesses to Madras
Aluminium Company (M.A.L.CO.), with effect from April 1, 2009.
Post-demerger, Malco was to be christened as Sterlite
Aluminium and Vedanta was to transfer 79.4 percent equity
interest in Konkola Copper Mines Plc (K.C.M.) to Sterlite.
Pursuant to the proposed scheme, for every four shares
held in Sterlite, the shareholders would have received seven
equity shares in M.A.L.CO. Also, Sterlite would have issued
one share for every 51 equity shares held in M.A.L.CO.
Besides, the other aluminium business undertakings of the
Vedanta Group would have demerged into M.A.L.CO., which
include the aluminium foils plant at Sanaswadi, 51 percent
stake in Balco and 29.5 percent stake in Vedanta Aluminium.
The NRI-billionaire Anil Agarwal-led company has already
announced plans to increase its aluminium capacity to 2.6
million ton per annum from the present 10 lakh tons in India.
Post-expansion, the aluminium business of the company is
expected to accrue four billion dollar profit annually and
make it one of the top five aluminium producers globally.
The company also envisages to invest two billion dollar
in the power sector for setting up a 10,000 M.W. generation
capacity and 700 million dollar to increase iron ore
manufacturing capacity in Sesa Goa to 25 million tons by 2010.
Apart from increasing output of the existing mines,
Vedanta Resources is looking for iron ore assets in Central
Africa and Brazil for acquisition. PTI SCV
AMT