So how does the debt split up? Does that also get distributed equally between the six companies? Or, can Vedanta decide that one of their units is doing so bad, it's going to be shut down eventually, and so they move all their debt to this new entity, and wait for it to fail and take all its debt with it.
The debt that I've referred to in this piece is of Vedanta Resources, the parent company. The company that is looking to split is Vedanta Ltd. So there is no splitting of *that* debt as the parent company will continue to owe the amount it owes.
That said, Vedanta Ltd also does have its significant debt of more than $6 billion that I can see from last FY's report. Whatever Vedanta Ltd decides, lenders will have to approve. It won't be able to dump all the debt into one entity and file for insolvency for that company. That said, there are some creative actions possible here (especially if some lenders are more affable than others) and I suspect I'll be writing about this again once there's more in the news :)
Can't imagine what will happen to investors ?
So how does the debt split up? Does that also get distributed equally between the six companies? Or, can Vedanta decide that one of their units is doing so bad, it's going to be shut down eventually, and so they move all their debt to this new entity, and wait for it to fail and take all its debt with it.
The debt that I've referred to in this piece is of Vedanta Resources, the parent company. The company that is looking to split is Vedanta Ltd. So there is no splitting of *that* debt as the parent company will continue to owe the amount it owes.
That said, Vedanta Ltd also does have its significant debt of more than $6 billion that I can see from last FY's report. Whatever Vedanta Ltd decides, lenders will have to approve. It won't be able to dump all the debt into one entity and file for insolvency for that company. That said, there are some creative actions possible here (especially if some lenders are more affable than others) and I suspect I'll be writing about this again once there's more in the news :)