Vedanta will take relook at alloy biz – Times of India

Mumbai: Five years after foraying into the steel business, metals and mining magnate Anil Agarwal will review his play in the alloy sector. On Friday, his India-listed firm Vedanta said it has engaged advisers to assist in the review. The move comes as Agarwal looks to raise funds to honour debt obligations.
Vedanta entered the steel business with the acquisition of Electrosteels Steel for Rs 5,320 crore in 2018. In a regulatory filing, Vedanta said it continues to review strategic priorities in the normal course of its capital allocation discussions and has decided to initiate a review of its steel and steel making raw materials businesses. “The review will begin immediately and will evaluate a broad range of options including a sale of some or all of the steel businesses.”
Vedanta purchased Electrosteels Steel as it complemented its iron ore business and a vertical integration of the manufacturing facilities had the potential to generate significant synergies, it had said after the deal.
Electrosteels has its manufacturing plant in Bokaro, Jharkhand, with an annual capacity of 1.5 million tons, while Vedanta’s iron ore mines are in Karnataka and Goa. Enthused by the demand growth, Vedanta planned to double Electrosteels’s manufacturing facility to three million tons.
There has been speculation that Vedanta would exit the steel industry but its management in November 2022 said that exiting Electrosteels was not their priority but expanding its manufacturing capacity was.
Friday’s news comes at a time when Vedanta is relying on money from its business arms to tackle debt, after previous attempts to sell some assets to Hindustan Zinc failed. Vedanta had tried to sell the international zinc business to Hindustan Zinc for $2.98 billion but the deal had to be dropped after the government, which owns a significant minority stake in Hindustan Zinc, opposed the move.