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Vedanta completes reorganization evaluation and declares that the current structure is optimal

Vedanta completes reorganization evaluation

Vedanta completes reorganization evaluation, says the current situation is optimal

Vedanta completes reorganization evaluation – Vedanta, founded by billionaire Anil Agarwal, announced on Tuesday that it has completed a reorganization assessment and determined that the company’s present structure is optimal and appropriate for its current scale and diverse lines of business. 
 
It further stated that, for the reasons stated above, the firm will not undergo any corporate reform, such as a demerger or spin-off, and will remain in its current structure. 
 
The corporation, on the other hand, has proclaimed a capital allocation policy that is consistent, rigorous, and balanced, as well as long-term balance sheet management. 
 
According to the regulatory filing, Vedanta would invest judiciously in acquisitions that are accretive to current operations or have synergies with its core businesses. 
 
The company’s capital allocation policy will be the key guiding element, and it will focus on organic growth, according to the statement. 
 
Vedanta said it will evaluate select mergers and acquisitions as part of its overall capital allocation framework, and that it has a demonstrated track record of successfully turning around acquired firms. 
 
According to the statement, the company will participate in a divestment program that is strategic for the portfolio. 
 
The bid for BPCL is now at the EOI (Expression of Interest) stage, and if the deal goes through, the company may manage the acquired business through a profit-sharing arrangement or a management fee model, according to the company.

Vedanta completes reorganization evaluation

It was mentioned that a special fund with a strategic investor will be established to fund the possible investment without relying on Vedanta Ltd’s balance sheet. 
 
It went on to say that its dividend policy is both simple and comprehensive. It further stated that a minimum of 30% of the company’s attributable profit after tax (before exceptional items) (excluding profits of Hindustan Zinc Ltd (HZL)) shall be given as dividends. 
 
Hindustan Zinc’s dividend will be distributed within six months. According to Vedanta, this is subject to the board’s examination of numerous elements such as cash flow resilience, economic situation, commodity price cycles, natural calamities, and so on, in order to achieve overall optimal cash management. 
 
“We will continue to focus on operational excellence to boost profitability and free cash flows,” Anil Agarwal said of the decision. To maximize shareholder value, we are dedicated to maintaining appropriate levels of debt and maintaining a healthy balance sheet.” 

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