Vedanta Delisting: Best for retail investors to bide time
The de-listing offer of Vedanta Ltd has failed, according to the data available on the stock exchange website. To de-list the shares from the bourses, Vedanta’s UK promoters required 134 crore shares. According to the BSE website, only 125.47 crore shares were tendered till 7.20 pm.
However, the company can come out with a revised price. But it may not get shares below ₹320 a piece for de-listing as LIC has sought that price for tendering its nearly 24 crore shares. Neither the merchant banker to the de-listing offer nor Vedanta issued any statement till the time of going to the press.
UK promoters of Vedanta hold around 50 per cent in the company and had to acquire 40 per cent stake to de-list.
“Bidding for Vendanta was extended till 7 pm and data till 7.20 pm show that the threshold 90 per cent bid has not been received. If this be the case, the de-listing attempt has failed and the question of making a counter offer does not arise. Shares tendered by investors would have to be returned in the next 1-2 working days. Unpaid dividend, on the basis of what was paid by Hindustan Zinc Ltd to Vedanta, will have to be paid in due course. This means a dividend yield of 10 per cent or more at the current price,” said Arun Kejriwal, Founder, Kejriwal Research.
“The independent directors of Vedanta have completely failed in protecting the interest of retail shareholders but the markets, and especially LIC, have given a befitting reply if it is true that it bid at ₹320 per share. Markets have not given them the required shares to delist as the company’s value is much higher than the floor price of ₹87.25. Now, if the company has to de-list no shareholder will give shares below ₹320/share, which is what LIC has bid at,” said Anil Singhvi, promoter of proxy advisory form IiAS.
Dividend
Market experts say that Vedanta will now have to pay ₹12 per share dividend it has received from Hindustan Zinc, which so far it did not pass on to the shareholders.
Another proxy advisory firm, SES, had asked investors to bid between ₹236 and ₹320/share.