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Vedanta Group companies Sterlite Industries and Sesa Goa have received their shareholders’ approval for the proposed merger.
A total of 1,244 shareholders and creditors representing Sterlite Industries, Madras Aluminium, Sterlite Energy, Vedanta Aluminium and Sesa Goa participated in the voting procedure held at Panaji in Goa on June 19. Of them, 1,073 (representing 86.25 per cent) voted for the resolution to merge these entities and form a new company Sesa Sterlite. Another 171 (13.75 per cent) were against the resolution, while 13 others abstained from voting. Similarly, 861 Sterlite Industries investors attended a meeting for getting shareholders’ approval for the merger plan. Of them, 703 (representing 81.65 per cent) investors were for the merger and 158 against it.
According to the merger proposal, Sterlite shareholders will get three shares of Sesa Goa for every five shares held. Sesa Sterlite will become the seventh largest diversified resources company in the world with business interests in iron ore mining, copper, aluminium, zinc, lead, silver and oil and gas.
Earlier, the Competition Commission of India had approved the merger plan proposed by the holding company Vedanta Resources. In February, the UK-based Vedanta Resources had proposed to merge its Indian firms into a single entity Sesa Sterlite and offload debt of $9 billion (Rs 45,000 crore).
Post-reorganisation, Vedanta Resources will own a 58.3 per cent in Sesa Sterlite. It currently has 54.6 per cent in Sterlite and 55.10 per cent in Sesa Goa.
Vedanta Resources will also transfer its shareholding of 38.8 per cent in Cairn India to the new entity along with the debt of $5.9 billion raised to acquire Cairn India. Sesa Goa will pay a nominal consideration of $1 for buying Cairn India stake. Post the transfer, Sesa Sterlite will have a 58.9 per cent shareholding in Cairn India.
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