Mumbai: The Anil Agarwal-led Vedanta Resources Inc has called off a $9.8 billion corporate restructuring plan amidst shareholder opposition and market uncertainties stemming from the financial market crisis.
The London-listed mining group, with diversified operations in India, said it will not immediately pursue the mega restructuring proposal.
Vedanta had, on September 9, announced plans for a reorganisation of its group companies into three major subsidiaries, creating a group for copper and zinc, another for aluminum and energy (mainly power) and a third for iron ore.
A Vedanta official said the group had been under pressure from shareholders to restructure for several years but that the proposals on an African project, on which they had not been consulted, met with a ''mixed reaction'' at presentations in Singapore, Europe and the US.
Minority shareholders in Sterlite, the Indian copper smelter and refiner and the group's biggest subsidiary, questioned the valuation of KCM, the Zambian copper mining operation. Vedanta was proposing to transfer its 79.4 per cent equity stake in KCM to Sterlite.
Sterlite was to exchange its shares one-for-one with that of THL KCM, the holding company for Vedanta's KCM stake. But Sterlite's minority shareholders argued they were being disadvantaged by the deal.
Chairman Anil Agarwal, however, said the group remains committed to streamlining operations. He said the group has reserves of $6.5 billion and can comfortably go ahead with the $25 billion expansion plan.