Centre opposes Hindustan Zinc's $2.98 billion deal for Vedanta zinc assets

India's federal government has opposed Hindustan Zinc's proposed $2.98 billion acquisition of zinc assets from Vedanta Ltd, a letter from the government to the company showed on Monday.

Directors nominated by the government at Hindustan Zinc had dissented to the proposed deal announced on Jan. 19, the letter showed.

The government holds a near 30% stake in Hindustan Zinc, while Vedanta is the company's largest shareholder.

According to the letter, the government reiterated dissent to the "related party transaction". "We would urge the company to explore other cashless methods of acquisition of these assets."

The government will oppose any further resolutions on the deal and explore all legal avenues available to it, it added.

Hindustan Zinc and Vedanta did not immediately respond to Reuters requests for comment.

 

(Reporting by Meenakshi Maidas and Chris Thomas in Bengaluru; Editing by Dhanya Ann Thoppil and Devika Syamnath)