Nippon MF, Morgan Stanley, SBI MF top bidders for Vedanta $1 billion QIP

Nippon Mutual Fund (MF), Morgan Stanley, and SBI MF were the top subscribers in the just-concluded $1-billion equity share placement by Vedanta, a stock exchange filing made by the commodity major showed.

Nippon MF, through five schemes, subscribed for shares worth Rs 775 crore, 9.2 per cent of the total issue size. Morgan Stanley got an allotment for Rs 733 crore, or 8.6 per cent of the issue size, and SBI MF bought shares worth Rs 670 crore in the qualified institutional placement (QIP). Other top bidders included Société Générale (7.4 per cent of the issue size), Copthall (5.3 per cent), and ICICI MF (5.2 per cent). Sovereign wealth fund Abu Dhabi Investment Authority (ADIA) also participated in the QIP.

Vedanta raised Rs 8,500 crore (nearly $1 billion) via the QIP by issuing 193.1 million new equity shares at an issue price of Rs 440 apiece. The QIP, which closed on Friday, saw nearly three times more demand than the shares on offer. The share sale saw bids from foreign portfolio investors (FPIs), MFs, insurance companies, and other institutional investors.

“The overwhelming response to the Vedanta QIP underscores the huge confidence that the global investor community has in Vedanta - our unique set of irreplaceable world-leading assets, our quest for operational and cost excellence, and the solidity of our strategic future growth projects. We remain closely aligned with the goals of ensuring India’s self-reliance and security in the area of critical minerals and energy while contributing significantly to the nation's economic prosperity and the creation of shareholder value," Anil Agarwal, chairman, Vedanta, said in a press release.

The proceeds of the QIP will be used to continue to deleverage Vedanta’s balance sheet and pursue growth projects to achieve its near-term operating profit target of $10 billion, the company has stated.

These projects include the expansion of the aluminium smelter and refinery, investment in new oil and gas blocks, and expansion of the steel and iron ore businesses.