New Delhi, Feb 20 (PTI) Vedanta Ltd has received approval from its shareholders and creditors for its proposal to demerge the company into five independent, sector-specific companies, according to a stock exchange filing by the company.

The demerger was approved by 99.99 per cent of shareholders, 99.59 per cent of the secured creditors, and 99.95 per cent of unsecured creditors of Vedanta Limited who voted in favour of the demerger, as per the stock exchange filing made by the company.

According to Vedanta’s demerger scheme, every Vedanta shareholder will receive 1 additional share in each of the 4 newly demerged companies on the completion of the demerger process.

The five companies are Vedanta Aluminium, one of the world’s largest producers of aluminium; Vedanta Oil & Gas, India’s largest private-sector crude oil producer; Vedanta Power, one of India’s largest generators of power; Vedanta Iron and Steel - a company with a highly scalable ferrous portfolio; and Vedanta Limited – which will include the world’s second largest integrated zinc producer & third largest silver producer – in Hindustan Zinc.

Vedanta Ltd. will also act as an incubator for new businesses, including Vedanta’s technology verticals.

As per Vedanta’s demerger scheme, the demerger will create five independent companies of a global scale focussed on the mining, production and/or supply of aluminium, iron-ore, copper, oil & gas, and on generation and distribution of power.

It will enable greater focus of the Vedanta management on the relevant businesses thereby allowing further streamlining of operations and more efficient usage of assets and leveraging of opportunities.

Similarly, the demerger scheme has emphasised that over time, each of the independent companies can attract different sets of investors, strategic partners, lenders, and other stakeholders enabling deeper collaboration and expansion in these specific companies without committing the existing organisation in its entirety.

The demerger will enable investors to separately hold investments in businesses with different investment characteristics and market potential thereby allowing them to select investments which best suit their investment strategies and risk profiles.

As per Vedanta’s demerger scheme, it will also enable focused and sharper capital market access (debt and equity), thereby unlocking the value of the demerged entities.

Vedanta Limited currently operates a diversified portfolio with interests in metals, mining, oil and gas, power generation, and other emerging sectors.

As listed companies have to seek various approvals under relevant sectoral and capital market regulations, the proposed demerger scheme will remain subject to receipt of other applicable statutory, government and regulatory approvals, including inter alia from the National Company Law Tribunal. PTI ANZ DR

Demerger approval enables creation of five sector-specific companies with separate share issuance, subject to statutory clearances. The proposed demerger was approved by shareholders and creditors to create five independent sector-specific companies, with each Vedanta shareholder to receive one additional share in each of four newly demerged entities; the retained company will incubate new businesses. The scheme aims to focus management, streamline operations, unlock value through separate capital market access, and enable distinct investor and lender engagement. Implementation is subject to receipt of all relevant statutory, governmental and regulatory approvals.