Mumbai: The Mumbai bench of National Company Law Tribunal has deferred the hearing for Vedanta to September 17, which could effectively see the company missing its deadline of September 30 for its proposed demerger. The hearing, which was underway on Wednesday, was deferred after the Ministry of Petroleum and Natural Gas presented its objections in court.
In the hearing in July, the counsel for the Government of India, Ministry of Oil and Natural Gas had asked to make submission on the next occasion. Their objections included a potential impact on their ability to recover dues under existing production and revenue-sharing contracts associated with Vedanta's oil and gas operations.
"Vedanta has filed a detailed response to the Centre's representation," a spokesperson for the company said. "The Company has informed the Hon'ble National Company Law Tribunal that the Company will issue a corporate guarantee in favour of the Ministry of Petroleum and Natural Gas once the Scheme becomes effective," the person said.
This is in case Malco Energy is unable to meet or satisfy potential contractual liability, if any, towards the Ministry arising under the Production Sharing Contracts and Revenue Sharing Contracts, the company said.
Vedanta, led by billionaire Anil Agarwal, had proposed splitting its operations into independent listed companies focusing on aluminium, base metals, iron and steel, oil and gas, and power generation. The company believes that this move will unlock shareholder value.
Additionally, the demerger is also expected to allow each independent company to attract specialized investors, strategic partners, and lenders, fostering deeper collaborations and expansion without affecting the broader organization.
The board of Vedanta had approved the demerger in September 2023. The company has also received approvals from its secured and unsecured creditors and equity shareholders.
In the hearing in July, the counsel for the Government of India, Ministry of Oil and Natural Gas had asked to make submission on the next occasion. Their objections included a potential impact on their ability to recover dues under existing production and revenue-sharing contracts associated with Vedanta's oil and gas operations.
"Vedanta has filed a detailed response to the Centre's representation," a spokesperson for the company said. "The Company has informed the Hon'ble National Company Law Tribunal that the Company will issue a corporate guarantee in favour of the Ministry of Petroleum and Natural Gas once the Scheme becomes effective," the person said.
This is in case Malco Energy is unable to meet or satisfy potential contractual liability, if any, towards the Ministry arising under the Production Sharing Contracts and Revenue Sharing Contracts, the company said.
Vedanta, led by billionaire Anil Agarwal, had proposed splitting its operations into independent listed companies focusing on aluminium, base metals, iron and steel, oil and gas, and power generation. The company believes that this move will unlock shareholder value.
Additionally, the demerger is also expected to allow each independent company to attract specialized investors, strategic partners, and lenders, fostering deeper collaborations and expansion without affecting the broader organization.
The board of Vedanta had approved the demerger in September 2023. The company has also received approvals from its secured and unsecured creditors and equity shareholders.
