By Alex MacDonald
LONDON--U.K.-listed, India-focused Vedanta Resources (VED.LN)
said Wednesday that its debt refinancing plan is progressing well
and that it wants to secure an investment grade credit rating in
the future.
Credit rating companies, Moody's Investors Service and Standard
and Poor's, both put Vedanta's long-term credit rating under review
for a possible downgrade recently due to concerns about the
company's ability to finalize the refinancing of its upcoming
maturities.
The FTSE-100 miner's Chief Financial Officer DD Jalan sought to
allay those concerns by telling analysts on a call that "The
refinancing is progressing well and we expect it to be closed well
ahead of the [June] maturity."
Vedanta has $1.35 billion of debt due to mature in June and
announced on Wednesday that it had successfully refinanced an $810
million payment due April 29 that is part of an $883 million
convertible bond due in 2017.
Mr. Jalan said the convertible bond payment was refinanced by
using cash and bank loans, resulting in an average financing coupon
rate of 4% annually with a maturity of over four years. He noted
that this was similar to the previous coupon payment on the
convertible bond and that he expects Vedanta's future refinancing
plans to be executed at similar levels.
"We have got a robust business," Mr. Jalan said, adding that he
is hopeful the credit rating agencies' concerns will be allayed in
coming months, following the completion of its refinancing
program.
Mr. Jalan said he expects to be in a position to unveil the
final refinancing program in early May and noted that the company
wants to raise its credit rating to investment grade over time.
Moody's has a Ba1 corporate family rating and a Ba3 senior
unsecured rating on Vedanta, while S&P has a 'BB' foreign
currency long-term rating on the company. These ratings are
currently below investment grade.
-Write to Alex MacDonald at alex.macdonald@dowjones.com
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