Vedanta Chairman Confident Sesa Goa, Sterlite Holders To Approve Deal
February 25 2012 - 10:29AM
Dow Jones News
U.K-listed, India-focused miner Vedanta Resources PLC (VED.LN)
is confident that shareholders will approve the proposed merger of
its majority-owned Sterlite Industries Ltd. (500900.BY) and Sesa
Goa Ltd (500295.BY) units, the company's chairman said
Saturday.
"It is a very win-win [transaction] for everyone," he said
Chairman Anil Agarwal in an interview with Dow Jones Newswires.
He said the proposal is better than the restructuring proposal
unveiled to shareholders in 2008. That proposal was met with
shareholder resistance and ultimately scrapped.
Agarwal said that "shareholder value is enhanced" in the current
deal.
Vedanta owns a 55% stake in Sesa Goa and a 58% direct and
indirect stake in Sterlite Industries.
Vedanta has proposed merging Sterlite into Sesa Goa to create a
new company called Sesa Sterlite. The proposed merger envisages
Sesa Goa issuing three shares for every five Sterlite shares, in a
deal that would create the world's seventh largest global
diversified natural resources company by earnings before interest,
taxes, depreciation and amortization, or Ebitda with assets in oil
and gas, zinc, iron ore, lead, aluminum and electricity.
Sesa Goa could have a valuation of more than $20 billion once
the deal is completed, Agarwal said. The deal is expected to close
toward the back end of the third quarter or fourth quarter of 2012
but needs both shareholder and regulatory approvals before it can
close.
Vedanta shareholders are expected to vote on the deal at an
extra-ordinary meeting in May while Sesa Goa and Sterlite
shareholders are expected to vote on the deal at a similar meeting
in June 2012.
-By Alex MacDonald, Dow Jones Newswires; 44 20 7842 9328;
alex.macdonald@dowjones.com
(Sourav Mishra in Mumbai contributed to this story.)
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