Tycoon Agarwal’s India Zinc Arm To Pay $305 Million In Dividends
(Bloomberg) -- Hindustan Zinc Ltd. will pay $305 million in dividends to shareholders ahead of its ultimate parent Vedanta Resources Ltd.'s $1 billion bond repayment due next month.
Billionaire Anil Agarwal's Indian zinc maker will give 6 rupees a share, or a total of 25.4 billion rupees, in a second interim dividend for the financial year that started on April 1, the company said in an exchange filing Wednesday. It distributed almost 30 billion rupees in July and about 319 billion rupees in four tranches last year.
Agarwal's London-based Vedanta Resources is grappling with a huge debt pile. It needs to pay about $3 billion over the next two years as some US currency bonds will mature. The company heavily relied on dividends from India-listed Vedanta Ltd. and Hindustan Zinc in the past.
The junk-rated mining conglomerate has approached investors to restructure some of its bonds, and plans to split its sprawling group to unlock better value for individual businesses.
Hindustan Zinc has been doling out dividends despite a tight net cash position. Its parent Vedanta Ltd. has only paid one round of dividends this fiscal year after an unprecedented five last year.
The Indian government has a stake of about 30% in the Rajasthan-based miner.
Shares of Hindustan Zinc rose as much as 2.2% Wednesday, while Vedanta Ltd. advanced 1.1%. The dollar bond of Vedanta Resources, due in January and August, gained ahead of Hindustan Zinc's board meeting.
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