Vedanta may tap credit funds for raising up to $1 billion

According to sources, Vedanta Group has expanded its borrowing net to credit funds such as Farallon Capital, Davidson Kempner, and Ares SSG Capital in order to meet more than $1 billion in upcoming repayments. 

The banks' pricing is 300 basis points higher than the expected rate, they claim. THL Zinc Ventures, a wholly owned subsidiary of India-listed Vedanta Ltd (VDL), is negotiating a lower asking rate with global lenders such as JP Morgan, Barclays, Standard Chartered Bank, and Deutsche Bank.

The loan, for which talks with banks began a month ago, was expected to be raised at the secured overnight financing rate, or SOFR+500 basis points. According to the people cited above, the lenders have provided a term sheet at SOFR+800 bps for the 3-3.5-year loan. The current SOFR is 4.55%.

After the government opposed the Hindustan Zinc (HZL) board's move to buy THL Zinc Ventures in a $2.98 billion cash deal, Vedanta has been looking into ways to raise funds to meet upcoming maturities.

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