Article/Intelligence
UPDATE 13: Vedanta Resources Plans USD Bond Issuance to Refi Outstanding 13.875% 2028 Bonds, 9.25% 2026 Notes in Q1 CY’25
Wed Dec 04, 2024 08:43 AM ET: Editor’s Note: The following story was published in the evening on Dec. 4 and has been reissued during regular business hours to reach a wider audience.
Vedanta Resources Ltd. or VRL, told investors today, Dec. 4, that it plans to issue another U.S. dollar bond with a seven- to 10-year tenor in the first quarter of the 2025 calendar year to refinance the remainder of its termed-out 13.875% bonds due 2028 and nonguaranteed 9.25% bonds due 2026, two sources briefed on the matter said.
The London-headquartered oil-to-metals company also told investors that the consent solicitation process was launched on Dec. 2 primarily to allow a credit rating upgrade which would enable it to price the planned bond at sub 10%, the sources said.
VRL was only able to raise $800 million through its latest bond issuance in November, out of the intended $1.2 billion needed to refinance its 2028 bonds, as reported.
On Nov. 20, 2024, S&P Global Ratings upgraded its outlook on VRL to CreditWatch Positive indicating that it expects the company’s creditworthiness to improve on the successful full refinancing of its $1.2 billion 13.875% notes due 2028. Once the refinancing is complete, the rating agency expects VRL issuer credit rating to be upgraded to B from B-.
Since the company was not able to fully raise the targeted amount through the bond, on Dec. 2 it launched a consent solicitation process to increase the debt ceiling clause on the remainder of the termed-out bonds due 2028, as well as to do away with the bond acceleration clause. Bondholder consent would ensure that the acceleration clause is not triggered if the $600 million April 2026 bonds are not refinanced by December 2025. The company will also be able to take out the nonguaranteed due 2026 bonds through the planned guaranteed bond with the provision of a higher debt ceiling at subsidiary guarantors Twinstar Holdings and Welter Trading, the sources said.
VRL also told investors that it expects to repay and refinance the remainder of its originally $1.2 billion private credit facility in full by August 2025, the sources said, adding that the company said that while around $300 million will be repaid through brand fee, it is open to refinancing the remaining $550 million through various options. VRL’s management also told investors that it will soon be making an announcement regarding the funds raised for its Konkola Copper Mine in Zambia, the sources said.
Regarding the demerger of its Indian listco Vedanta Ltd., VRL told investors that it expects the demerger to be completed by June 2025.
Vedanta did not immediately respond to requests for comment.
UPDATE 12: Vedanta Resources to List $500M Due 2031, $300M Due 2028 Bonds on Dec. 4; Co. to Redeem $312.5M 13.875% Due 2028 Bonds on Dec. 4
Tue Dec 03, 2024 01:21 AM ET: Vedanta Resources Finance II Plc, a subsidiary of Vedanta Resources Ltd., or VRL, announced to the SGX this morning, Dec. 3, that its $500 million 11.25% guaranteed senior bonds due 2031 and $300 million 10.25% guaranteed senior bonds due 2028 will be listed and quoted in the bonds market with effect from 9 a.m. Singapore time on Dec. 4.
Separately, Vedanta Resources Finance II released to the SGX on Dec. 2 evening a notice of redemption to the holders of its 13.875% bonds due 2028 to redeem $312.5 million principal amount of the bonds on Dec. 4.
The redemption price for the bonds will be 100% of the outstanding principal amount of the bonds, plus accrued and unpaid interest, if any, to, but excluding, the redemption date.
Upon payment in full of the redemption price to the holders of the bonds on the redemption date, interest on the bonds will cease to accrue on and after the redemption date and the outstanding principal amount of the bonds will be zero, the announcement states.
UPDATE 11: Vedanta Resources Seeks Consent From Holders of Outstanding 13.875% Bonds Due 2028 to Enhance Debt Ceiling, Align Covenants With New Bonds
Mon Dec 02, 2024 09:51 AM ET: Editor’s Note: The following story was published in the evening on Dec. 2 and has been reissued during regular business hours to reach a wider audience.
Vedanta Resources Ltd., or VRL, announced to the SGX late today, Dec. 2, the launch of a consent solicitation exercise for its outstanding 13.875% bonds due 2028.
The company is seeking consent to amend certain covenants to align the bonds with the terms and conditions of the new series of bonds that the company issued this year, which, among other things, will allow the group to: (1) use the increased debt incurrence headroom provided in the covenant package of the new series of bonds such that the refinancing of certain existing indebtedness can be accommodated; and (2) efficiently manage its debt maturity profile and improve its capital structure and overall financial position.
The proposed early consent fee for the amendment of the Regulation S Bonds and Rule 144 bonds due 2028 is $3.5 per $1,000 principal amount of bonds. The proposed late consent fee is $1 per $1,000 principal amount of bonds.
The aggregate principal amount of the notes outstanding as of the date is $893.8 million, after the application of a pool factor of 0.94.
Early voting deadline for the consent solicitation is Dec. 16 at 5 p.m. EST and the final voting deadline is Dec. 20 at 5 p.m EST, according to the announcement. The meeting of the bondholders is scheduled on Dec. 24 at 9 a.m Singapore time.
Citigroup Global Markets Ltd. is the solicitation agent for the consent solicitation and Sodali & Co is acting as the information and tabulation agent, the announcement states.
UPDATE 10: Vedanta Resources to Redeem Up-to $893.9M Principal of 13.875% Bonds Due 2028 Around Dec. 20; Co. Prices $300M 3.5NC1.5Y 10.25% Notes, $500M 7NC3Y 11.25% Notes at Par
Editor’s Note: The following story was published in the evening on Nov. 26 and has been republished in regular business hours to reach a wider audience.
Vedanta Resources Ltd., or VRL, released to the Singapore exchange on Nov. 26 evening a notice dated Nov. 20, of conditional redemption to holders of its 13.875% bonds due 2028 to redeem up to $893.846 million in principal amount of the notes on or about Dec. 20. The redemption will be at 100% of the outstanding principal amount of the bonds plus accrued and unpaid interest, if any, to, but excluding, the first redemption date.
The redemption is subject to the satisfaction or waiver by VRL of the refinancing condition, according to the notice.
Separately, VRL subsidiary Vedanta Resources Finance II plc announced the same evening the pricing at par on Nov. 25 of $300 million 3.5-year non-call 1.5-year guaranteed senior 10.25% bonds due 2028, and $500 million seven-year non-call three-year 11.25% bonds due 2031. Proceeds are to partially refinance the outstanding 13.875% bonds due 2028, as reported.
Final combined orders were $1.19 billion from existing and new investors. Final allocations were 32% from Asia, 36% from EMEA, and 32% from the U.S. for the 3.5-year tranche, and 35% from Asia, 23% from EMEA, and 42% from the U.S. for the seven-year tranche, the announcement states.
UPDATE 9: Vedanta Resources to Redeem $295.7M in Principal Amount of 13.875% Bonds Due 2028 on Nov. 20; to Further Redeem Certain Amount of 13.875% Bonds on or Before Dec. 20, Conditional on Funding
Tue Nov 19, 2024 04:39 AM ET: Vedanta Resources Finance II Plc, a subsidiary of Vedanta Resources Ltd., or VRL, announced to the Singapore exchange this morning, Nov. 19, a notice of conditional redemption to the holders of its 13.875% bonds due 2028 to redeem $295.73 million in principal amount of the notes on Nov. 20, the first redemption date. The redemption will be at a price of 100% of the outstanding principal amount of these bonds, plus accrued and unpaid interest, if any, to (but excluding) the first redemption date.
Further, the issuer will redeem a certain amount of 13.875% bonds due 2028 on or before Dec. 20, at a price of 100% of the outstanding principal amount of these bonds, plus accrued and unpaid interest, if any, to (but excluding) the second redemption date.
VRL is expected to launch the roadshow for its planned up to $1.2 billion bond offering as early as this week, two sources familiar with the development said yesterday, Nov.18. The likely dual-tranche bond issue will have four- and six-year tenors, as reported.
The record date on which any holder must hold any redeemed bonds and accrued and unpaid interest is the Clearing System Business Day immediately prior to the date for payment.
The redemption of the bonds under the second redemption date is conditional on the arrangement of funding by the issuer, according to the announcement.
The issuer will notify the noteholders of the actual second redemption date when determined but, for the avoidance of doubt, the determination of the second redemption date will not require the issuer to send a new 30-day notice of redemption, the announcement states.
UPDATE 8: Bondholders’ Trustee Encumbers 1.6B Vedanta Shares to Cover $300M 10.875% Bonds Due 2029
Mon Oct 28, 2024 09:57 PM ET: Citicorp International Ltd., acting as trustee for the bondholders, informed the BSE Ltd. on Oct. 28 afternoon that on Oct. 25, 1.6 billion shares of Vedanta Ltd., or VDL, representing 40.99% of the total share capital of the company, have been encumbered to cover Vedanta Resources Ltd.’s $300 million 10.875% guaranteed senior bonds due 2029.
The encumbered shares are owned by Vedanta Resources’ subsidiaries – Twin Star Holdings Ltd. and Welter Trading Ltd., according to the announcement.
UPDATE 7: Vedanta Resources Issues $300M Tap to $900M 10.875% Due 2029 Bond at 9.998% Yield
Tue Oct 22, 2024 12:06 AM ET: Vedanta Resources Ltd., or VRL, has priced its $300 million tap issue to the $900 million 10.875% bond due 2029 at 102.75 to yield 9.998%, terms seen by Reorg show.
UPDATE 6: Vedanta Resources to Partly Redeem 13.875% Bonds Due 2028; Co. Says Redemption Conditional on Funding
Mon Oct 21, 2024 04:40 AM ET: Vedanta Resources Finance II Plc, a subsidiary of Vedanta Resources Ltd., or VRL, announced today, Oct. 21, that it has given notice of conditional redemption to the holders of its 13.875% bonds due 2028 at a price of 100% of the outstanding principal amount of these bonds, plus accrued and unpaid interest. The company plans to redeem “a certain amount of these bonds” on or about Nov. 20, according to the announcement.
Vedanta Resources Finance II clarified in the announcement that the redemption of the bonds is conditional on the arrangement of funding by the issuer.
Reorg reported this morning that VRL is planning to raise around $300 million by tapping its $900 million 10.875% bond due 2029 and plans to use the proceeds to partly refinance its outstanding termed out guaranteed 13.875% bonds due 2028.
UPDATE 5: Vedanta Resources Seeks Tap to its $900M 10.875% Bond Due 2029; IPG in 102.5 Area
Sun Oct 20, 2024 09:43 PM ET: Oil-to-metals company Vedanta Resources Ltd., or VRL, is seeking today, Oct. 21, to tap its $900 million 10.875% bond due 2029, according to the terms seen by Reorg. Initial price guidance for the tap issue, rated CCC+, has been set in 102.5 area, the terms show.
VRL is targeting to raise around $300 million through a public bookbuild and intends to use the proceeds to partly refinance its outstanding termed out guaranteed 13.875% bonds due 2028, as reported. Barclays, Citi, Deutsche Bank, JPMorgan and Standard Chartered Bank are the global coordinators for the tap issue. The company may consider raising more than $300 million subject to investor demand, as reported.
Reorg reported on Oct. 19 that VRL intends to launch the tap as early as Oct. 21.
UPDATE 4: Vedanta Resources Set to Launch Tap to its $900M 10.875% Bond Due 2029 as Early as Next Week
Sat Oct 19, 2024 03:14 AM ET:
Vedanta Resources Ltd. or VRL, is preparing to tap its $900 million, 10.875% bonds due 2029 to raise a further around $300 million and the launch is expected as early as Monday, Oct. 21, a source close and a source familiar with the development said. Barclays, Citi, Deutsche Bank, JPMorgan and Standard Chartered Bank have been appointed as the global coordinators for the tap, the source close said.
Proceeds will primarily be utilized to partly refinance VRL’s outstanding termed out 13.875% bonds due 2028, as reported. The company may consider raising more than $300 million subject to investor demand and is targeting a tighter pricing for the tap at 9.5%-10%, the sources said.
The company in October raised a $125 million loan from Standard Chartered Bank to refinance its upcoming loan obligations, as reported. The loan matures in August 2025 and has been priced in “low double digits”, the sources familiar said.
The oil-to-metals company has told a few investors in September that it intends to refinance $2 billion outstanding in bonds over 6-12 months, as reported.
Vedanta could not immediately be reached for comment outside of market hours.
UPDATE 3: Vedanta Resources Obtains $125M Loan From Standard Chartered; Proceeds to Fund Cash Flow Requirements
Tue Oct 15, 2024 10:33 AM ET: Oil-to-metals company Vedanta Ltd., or VDL, informed the BSE Ltd. on Oct. 15 evening that its parent Vedanta Resources Ltd., or VRL, on Oct. 10 signed a facility agreement with Standard Chartered Bank (Singapore) Ltd. for a $125 million loan, confirming Reorg’s report published earlier on the same day.
The proceeds will be used to fund the cash flow requirements of VRL Group, and transaction expenses contemplated under the agreement, the announcement states. The company intends to utilize the loan to repay its outstanding around $120 million due December loan from Syndicate Bank, according to sources, as reported.
As reported, 2.2 billion shares of VDL held by VRL, representing 56.38% of the total share capital of the company, have been encumbered to cover the facility.
Pursuant to the terms of the facility agreement, VRL had agreed to ensure in its capacity as the member of the promoter group of VDL, that VDL shall not undertake the following actions/activities unless permitted within the parameters of the facility agreement and/or with the consent of the requisite lenders:
- Subject to the carve-outs specified under the facility agreement, the creation of security over assets of VDL;
- Subject to the carve-outs specified under the facility agreement the sale, transfer and disposal of assets of VDL, which are not in the ordinary course;
- investment in or acquisition of material assets/business/shares by VDL in each case, which are assets/businesses not associated with mining, metals, coal, oil and gas exploration and/or production, infrastructure, power or energy industries;
- Subject to the carve-outs specified under the facility agreement any merger of VDL;
- amendment of the constitutional documents such that it affects the rights of the lenders or has a material adverse effect under the facility agreement;
- Subject to the provisions of the facility agreement, creation of a restriction on distributions; and
- Subject to the provisions of the facility agreement grant of a loan to or guarantee of any indebtedness of the promoter or any affiliate.
UPDATE 2: Vedanta Resources Raises $125M Loan From Standard Chartered Bank for Refinancing Due December Loan
Tue Oct 15, 2024 04:38 AM ET:
Vedanta Resources Ltd., or VRL, last week raised an around $125 million 12-month unsecured loan from Standard Chartered Bank, two sources familiar with the development said. The company intends to utilize it to repay its outstanding around $120 million due December loan from Syndicate Bank, the sources said.
In a disclosure to the BSE Ltd. dated Oct. 14, Standard Chartered Bank (Singapore) Ltd., in its capacity as facility agent, said VRL and certain lenders signed a facility agreement on Oct. 10 and that 2.2 billion shares of Vedanta Ltd, or VDL, representing 56.38% of the total share capital of the company, have been encumbered to cover the facility.
VRL and Standard Chartered Bank did not immediately respond to requests for comment.
UPDATE 1: Lenders’ Agent Encumber 2.2B Vedanta Shares to Cover New Loan Facility
Tue Oct 15, 2024 03:37 AM ET: Standard Chartered Bank (Singapore) Ltd., in its capacity as the agent under a facility agreement signed on Oct. 10 between Vedanta Resources Ltd., or VRL, and certain lenders, informed the BSE Ltd. this morning, Oct. 15 that 2.2 billion shares of Vedanta Ltd, or VDL, representing 56.38% of the total share capital of the company, have been encumbered to cover the facility.
Reorg had reported on Sept. 26, citing sources, that VRL is in talks with its relationship banks – Barclays, Citi, Deutsche Bank, JPMorgan and Standard Chartered Bank, for an around $500 million five-year club loan to partly refinance its two series of outstanding termed out 13.875% guaranteed bonds due 2028.
The encumbered shares are owned by VRL’s direct and indirect subsidiaries – Twin Star Holdings Ltd., Welter Trading Ltd., Vedanta Holdings Mauritius Ltd., Vedanta Holdings Mauritius II Ltd. and Vedanta Netherlands Investments B.V., according to Standard Chartered’s announcement.
Original Story 9:05 p.m. UTC on Sep. 25, 2024
Vedanta Resources in Talks With Banks for ~$500M Club Loan, Considering ~$300M Tap to $900M 10.875% Bonds Due 2029 for Partial Refinance of Due 2028 Bonds
Oil-to-metals company Vedanta Resources Ltd. or VRL, is in talks with its relationship banks – Barclays, Citi, Deutsche Bank, JPMorgan and Standard Chartered Bank, for an around $500 million five-year club loan to partly refinance its two series of outstanding termed out 13.875% guaranteed bonds due 2028, a source close to and two sources familiar with the development said. The banks have yet to approve the loan, the sources said.
Separately, the company has also indicated to some fixed income investors this week that it is considering tapping its recently issued $900 million 10.875% bonds due 2029 to further raise around $300 million to also partly refinance the remaining termed out 2028 bonds, the two sources familiar said. Even as the tap has been discussed with the banks, the company will wait until price of the due 2029s to go up before it proceeds with the transaction, all three sources said.
Reorg first reported on Aug. 16 that the company plans to refinance its outstanding termed out guaranteed bonds – $470 million 13.875% bonds due 2027, $893.85 million, 13.875% due-December 2028s; and $1.01 billion, 13.875% due December-2028s – and $600 million non-guaranteed 2026 bonds in a staggered manner through additional debt guaranteed by subsidiaries –Twinstar Holdings and Welter Trading.
VRL raised $900 million in September and will use the proceeds to first refinance its $470 million 13.875% bonds due 2027 and then to partly refinance its $1.01 billion 13.875% bonds due 2028 with the remaining proceeds, as reported.
London-headquartered VRL is still trying to refinance the remainder of the two guaranteed series due 2028 and its $600 million 9.25% non-guaranteed bond due 2026 through a mix of bonds and loan, the first source close and the source familiar said, adding that the company is targeting to refinance the three series in the next 6-12 months.
Vedanta did not respond to requests for comment.