Vedanta Resources Limited (VRL) reports the creation of an encumbrance on equity shares of Vedanta Limited (VEDL) held by its subsidiaries. This relates to the issuance of US$ 500 million in 9.125% Guaranteed Senior Bonds due 2032 by Vedanta Resources Finance II PLC. The encumbrance is in accordance with the terms of a trust deed and a supplemental trust deed.
Details of Share Encumbrance
Vedanta Resources Limited (VRL) has announced an encumbrance on the equity shares of Vedanta Limited (VEDL) held by its subsidiaries Twin Star Holdings Ltd., Welter Trading Limited, and Vedanta Holdings Mauritius II Limited. This action is connected to the issuance of US$ 500 million in 9.125% Guaranteed Senior Bonds due 2032 by Vedanta Resources Finance II PLC, a VRL subsidiary, on October 15, 2025.
Purpose and Structure of the Encumbrance
The encumbrance arises from the terms and conditions (T&Cs) of the bonds, as outlined in a trust deed dated October 15, 2025, between Citicorp International Limited (Trustee), the Issuer, and VRL as parent guarantor. Furthermore, a supplemental trust deed will be executed to reinforce the structure. As part of the T&Cs, Promoter Group Entities face restrictions on creating security interests over directly held assets. Some conditions within the T&Cs might fall under the definition of ‘encumbrance’ as per regulations.
Impact and Clarifications
It’s clarified that no direct pledge has been created by any of the Promoter Group Entities over the equity shares of VEDL concerning the bonds as of October 17, 2025. The obligations relating to the bonds will take effect from the execution date of the Supplemental Trust Deed. This announcement relates to potential restrictions under the terms of the bond issuance, not a direct pledge.
Source: BSE
