Everything You Need to Know About Vedanta Delisting

Vedanta Ltd. the mining major is delisting its shares from Indian stock exchanges. You can check the announcement from the company here

The shareholders of Vedanta Ltd. can tender their bids in the offer starting from October 5th, 2020.

Update from the Company: The delisting offer has failed and shares of Vedanta will continue to trade on the Exchanges.

Shares tendered in the offer have been returned back to the Demat account of the shareholders.

  • Key Dates
Bid Opening Date October 05, 2020
Bid Closing Date October 09, 2020
Date for Announcement of Discovered Price & Acceptance/Non-Acceptance of Discovered Price October 16, 2020
Proposed Date for Payment Shareholders or Return of Shares in case of Bids not Accepted or Failure of the Delisting Offer October 23, 2020

How to apply for Vedanta Delisting?

You can tender your shares by logging into Console, the process has been explained in detail here.

What if I fail to bid or my bid isn’t accepted?

If you fail to bid or your bid isn’t accepted you will have time until one year from date of delisting to tender your shares, the promoters will buy back the shares from you at the final Exit offer price. You can learn more here

How will the payment be made?

If the delisting offer is successful, the payment will be made directly to your primary bank account. If bank account details of any shareholder are not available or if the fund transfer is rejected due to any reason, then the amount payable to the shareholder will be transferred to the concerned Seller Members (Broker) who will transfer it to the shareholder.

What if I’ve pledged my shares?

If you have pledged your shares, you will have to unpledge the shares to tender them in the delisting offer.

You can read more FAQ’s here

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What if shares are pledged.

You will have to unpledge the shares to tender them in delisting offer.

Okay btw how is price discovered, is it the weighted average from the shares tendered . And any upper or lower cap for bidding.

The exit price will be discovered through Reverse Book Building process, Can learn more here.

The floor price is Rs. 87.25, you can bid at any price, but if your price is higher than the exit price discovered then your shares won’t be bought.

You can read more on the Vedanta’s Delisting FAQ’s page

Hello I have VEDANTA shares which are going to be delisted. I have received email with letter of offer, BiDFOrm

Do I have to physically fill in these forms? and where do I send those?

Please advise

No need to physically fill the forms and submit. When the issue opens, you can tender your shares by logging into Console, the process has been explained in detail here

Hi
What price should one investor bid for Vedanta delisting
Kindly give guidance

Regards
A

Thanks for the detailed faq.
Suppose in bid timing from October 5 to 9, I put in a bid to sell my Vedanta Shares at 250 apiece. Say the price discovery stand at less than that. Therefore my bid wasn’t accepted.

How will I go about selling my shares at discovered price through Kite or physical DIS the only way?

If your bid goes unaccepted then in that case you will have time until one year from date of delisting to tender your shares, the promoters will buy back the shares from you at the final Exit offer price. You can learn more here. This is offline method.

  1. IF i bid for say 190Rs and discovered price is 195, will my share be bought for discovered Price or Bid price?

  2. Any Optimal price suggestion, so that my bid is close to discovered price?

You shares will be bought at Exit Price, 195.

This is something hard to predict, whatever price is discovered also has to be approved by promoters.

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Hi @ShubhS9,

Hi,

Sorry for asking few basic questions.
I would like to get clarified on below doubts.

I have few vendanta shares at an Average Price of around 170, as it is hard to bid for an optimum price, being a long term investor on this stock, if I bid at around 250,as I am expecting atleast some returns on my investment.

  • Exit price(140) lesser than my Average(170): There are chances that exit price could even be lesser than my average price(170), then I hope my bidding(250) will be rejected ? If rejected, as per other posts, there is only an alternative way to sell only at same discovered exit price(ex: 140) that too in offline mode? In this case I should bear my losses, correct ? Will there be no 2nd chance for adjusting my bid price, atleast to avoid offline difficulties bearing my losses ? Any other suggestions to incur minimum losses
  • Exit price(300) more than my Bid(250): As I already read, my shares will be considered at my bid price(250) itself, even if exit price is greater than that (ex: 300), I think its fair to recieve my expectations, but would there not be any other chance to adjust my bid price after exit price is discovered.
  • If delisting is successful, I haven’t participated/rejected, I didnt sell the shares even till 1 year,
    - What will happen to these shares in my demat account ?
    - Will these shares still be listed in my console ?
    - How can i get to know the live share price and how to manage them ?
    - What options I will be left with after 1 year ?

You will have time to bid only during Bid period, ie. From October 5 to October 9, post that you won’t be able to, if your shares aren’t accepted or you didn’t bid then only way to tender your shares is the offline method.

The shares will stay in your Demat account.

You will be able to view them in Console.

Once delisted from exchanges the shares will stop trading, so there will be no price fluctuations as well.

If you do not tender these shares within one year period then your only exit route is I) wait for company to list on exchanges again or II) find a willing buyer off-market.

How to bid my shares if I didn’t get letter of offer?

You can tender your shares by logging into Console, the process has been explained in detail here

It’s not showing Vedanta yet. Is it because opening date is on 5th of September??

It will start showing when issue opens on October 5th.

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Vedanta has arranged funds raised to make a delisting price of at least Rs 170 (as known in public domain - $3.15 billion raised in loans - 23000 crore rupees divided by 134 crore shares needed to increase their share holding to 90%)
However, they have capacity to pay a delisting price of at least 350 and even more ( More loans can be arranged immediately against these : Cash and liquid assets vedanta books - at least 20000 crores, Hindzinc dividend - 4500 crores, Hindustan Zinc pledge - can raise upto 40000 crores). Hence, once should have no fear of delisting failure to bid high. Bid at least 350 in the RBB.
In the unlikely event of delisting failure, metal upcycle is expected to result in a price of 500-600 in 2-3 years.
Remember, delisting is mandatory for promoter Vedanta resources plc to service debt. Vedanta limited will prosper with or without delisting. It is the promoter who is desperate for delisting. So don’t give your shares cheap.

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All the shares offered upto that final Discovered Price/Exit Price (DP/EP) should be bought at DP/EP. So, in the above example if one puts a bid for 500 shares at Rs 190/-, and the DP/EP is Rs 195/-, then all the 500 shares should be bought at Rs 195/-.

This is my understanding of Reverse Book Building Process. Could you please check and confirm once again?