Vedanta shares surge over 7% on encumbrance release

Shares of Vedanta jumped over 7% on Friday to Rs 505.45 on BSE, after the company updated the bourses about the release of encumbrances over its equity shares held by parent Vedanta Resources through subsidiaries.

The company announced that all encumbrances tied to a $1.2 billion bond issued by Vedanta Resources Finance II PLC had been redeemed.

These bonds, initially set to mature in 2025 but later extended to 2028, were guaranteed by Vedanta Resources Ltd (VRL) and its subsidiaries, viz, Twin Star Holdings, Welter Trading, Vedanta Holdings Mauritius (VHML), Vedanta Holdings Mauritius II (VHMLII) and Vedanta Netherlands Investments BV(VNIBV).


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"Pursuant to the conditional redemption notice dated November 18, 2024, the issuer has, as of December 4, 2024, redeemed the entire outstanding amount of the bonds, and all encumbrances created pursuant to the bonds and the trust deed have been released," the company’s exchange filing disclosed on December 5.

Vedanta clarified that no pledge had been created by promoter entities over the company's shares in relation to the bonds. Under the bond terms, promoter entities were restricted from creating encumbrances or disposing of assets without meeting specific conditions.

The transaction also involved Citicorp International as trustee and Axis Trustee Services as the onshore collateral agent.

The company’s shares have advanced over 100% in the last year.

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