Vedanta hikes holding in Sterlite to 82%

The London Stock Exchange-listed Vedanta Resources has increased its stake in Sterlite Industries to 82.33 per cent from 68.2 per cent through a rights issue.

While Vedanta directly holds 75 per cent in Sterlite through its holding company, Twinstar Holdings, it holds 4.76 per cent through Madras Aluminium Company. The balance 2.58 is held through the Vedanta Employee Welfare Trust. Anil Agarwal owns about 52 per cent stake in Vedanta Resources.

Sterlite had raised around Rs 2,000 crore through the 1:2 rights issue earlier this financial year at Rs 550 a share.

Sterlite had planned the issue to fund its expansion in group companies Bharat Aluminium Company and Hindustan Zinc. The group has chalked out a $2.2 billion growth plan that will focus on all its investments in India.

Vedanta has recently raised $500 million through a global dollar bond in December 2004, which was oversubscribed more than three times. This was the second tranche of fund raising by the group, after its $1 billion listing on the London stock Exchange in December 2003.

Apart from the bond issue, the company is also raising rupee debt from institutions along with internal accruals to fund its expansion.

Meanwhile, Vedanta Resources also injected $100 million into Vedanta Alumina, the group's 1.4 million tonne per annum alumina project in Orissa.

The infusion has increased Vedanta's direct holding in Vedanta Alumina to 70.5 per cent, while the balance is held by Sterlite. However, Vedanta's consolidated holding in the alumina project has increased to 95 per cent.