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Hindustan Zinc, the country’s largest zinc miner, plans to approach the Union Ministry of Mines in a bid to iron out differences over the acquisition of the overseas mines of holding company Vedanta Ltd.
The Centre is a minority shareholder with 29.5 per cent stake in the company and plans to divest this.
A meeting is likely over the next few days, CEO Arun Misra told businessline.
Earlier this year the board of Hindustan Zinc cleared a proposal to acquire Vedanta’s global zinc assets (mines) at nearly $3 billion. Hindustan Zinc is a Vedanta subsidiary, with the latter holding nearly 65 per cent.
At the board meeting, mines ministry representatives, who are a part of the board, raised objections to the valuation of the deal, saying itcould impact Hindustan Zinc’s valuation and its divestment plans.
‘Building consensus’
The Centre has been conducting roadshows for the divestment, but no offer for sale has been announced yet.
“We will go by the procedures laid down. So we’ll put up the proposal for acquisition for shareholder approval and there is a three-month-odd timeline for that. In the meantime, we will also reach out to the government (Centre) on the matter. We need all the shareholders on board. And it is only natural that we reach out to them (ministry officials) too,” Misra said.
The Hindustan Zinc board comprises chairperson Priya Agarwal Hebbar, who is Anil Agarwal’s daughter; CEO Arun Misra; Navin Agarwal; joint secretary-level officers of the Ministry of Mines Veena Kumari Dermal and Farida M Naik; Joint Secretary and Financial Advisor, Ministry of Coal and Ministry of Mines, Nirupama Kotru; Akhilesh Joshi, former CEO of Hindustan Zinc (2012-15); Anjani K Agrawal; and Kannan Ramamirtham.
Global expansion
According to Misra, the acquisition of Vedanta’s mines in Africa will give it a global footprint and aid “inorganic” growth. The buyout will give Hindustan Zinc a presence in the major consuming markets of Europe, the US and West Asia and “will be controlling a large part of the global market”.
The resource base will also double to 2 million tonnes, with 1 mt from India and 1 mt in South Africa.
“In fact, I would say at $3 billion this is an attractive buy. No new mines are available in India at the moment. Nor are we getting any immediately overseas,” he explained.
New mines (which are yet to be explored) would take 7-8 years before they become operational, Misra added.
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