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Khaitan & Co.

Founded in 1911, Khaitan & Co is a premier full-service Indian law firm with over 700 lawyers, including 145 partners.

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Deal Closed | J P Morgan Securities and Vedanta Limited | International Bonds - Underwriter Counsel

Khaitan & Co acted as the sole Indian legal adviser to the Joint Lead Managers in relation to Indian law

J.P. Morgan Securities LLC offers security brokerage services. The company markets U.S. government securities and money market instruments; underwrites and trades debt and equity securities; advises on business strategies, capital structures, and financial strategies; structures derivative transactions; executes and clears exchange-traded futures and options; clears over-the-counter derivative contracts; and offers brokerage and investment advisory products and services.

Vedanta Limited operates as a diversified natural resources company in India. The company explores for, develops, produces, processes, and sells zinc, lead, silver, oil and gas, aluminium, power, iron ore, steel, and copper.

The details of the deal are as under: 

Announcement Date:  21-Aug-2020

Completion Date: 21-Aug-2020

Name & Contact Details of Clients: J P Morgan Securities and Vedanta Limited

Deal Description: Khaitan& Co. acted as the sole Indian legal adviser to the Joint Lead Managers in relation to Indian law with respect to the offering of USD 1.4 billion senior secured bonds due in 2023 by Vedanta Holding Mauritius II Limited under Regulation S/Rule 144A of the U.S. Securities Act, 1933.  

The proceeds of the Bond issue will be inter alia utilised for financing the proposed delisting of the fully paid-up equity shares of Vedanta Limited in accordance with the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009. 

The Bonds are guaranteed by Vedanta Resources Limited, Vedanta Holdings Mauritius Limited and Vedanta Holdings Jersey Limited. Barclays Bank PLC, Credit Suisse (Hong Kong) Limited, Deutsche Bank AG, Singapore Branch, J.P. Morgan Securities PLC and Standard Chartered Bank acted as the Joint Lead Managers. The Bonds are secured by way of common collateral comprising of a (i) first priority share pledge by Vedanta Jersey over the entire capital stock issued by the Issuer; and (ii) first priority bank accounts pledge by the Issuer and by Vedanta Mauritius over its operative bank accounts held in Mauritius respectively. The Bonds are further secured by a first priority pledge over the bond escrow account into which the proceeds of the issue of the Bonds are deposited. Citigroup International Limited acted as the Trustee and Common Security Agent, with Standard Chartered (Mauritius) Limited acting as the Bond Escrow Bank. 

Total Consideration: USD 1.4 billion

Team Members: The core team consisted of Manisha Shroff (Partner), Smita Jha (Principal Associate), Enakshi Jha (Associate), Siddhant Shetty (Associate) and Akshay Ferdinand (Associate). 

Arindam Ghosh (Partner) and Gaurav Malhotra (Senior Associate) advised on the Indian law aspects of the Take Private Transaction. 

Rashmi Deshpande (Partner), Ritu Shaktawat (Partner), Anjali Krishnan (Senior Associate) and Sneh Shah (Senior Associate) advised on the Indian taxation laws.

Role of Firm: As the legal advisor the Joint Lead Managers, the Firm has worked on the following:

• Due-diligence on Vedanta Limited and its material subsidiaries;

• Review and commenting on the Offering Circular from the perspective of Indian laws; 

• Review of transaction documents including Subscription Agreement, Pricing Supplement, Signing & Closing Memorandum, Agency Agreement, Bond Escrow Agreement, Bond Escrow Pledge Agreement, Trust Deed and other supporting documents from the perspective of Indian laws;

• Advising on material disclosures, risks and issuing opinion to them on capacity of the Issuer and enforceability of the transaction documents under Indian law; 

• Advising on nuances under the Delisting Regulations and the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.

Financial Advisors: Barclays Bank PLC, Credit Suisse (Hong Kong) Limited, Deutsche Bank AG, Singapore Branch, J.P. Morgan Securities PLC and Standard Chartered Bank acted as the Joint Lead Managers. Citigroup International Limited acted as the Trustee and Common Security Agent, with Standard Chartered (Mauritius) Limited acting as the Bond Escrow Bank.

Other legal advisors:

• Issuer, Vedanta Mauritius, and Vedanta Jersey (English Law): Linklaters Singapore Pte. Ltd. 

• Joint Lead Managers (English Law): Latham & Watkins LLP 

• Joint Lead Managers (Mauritius Law): BLC Roberts & Associates 

• Joint Lead Managers (Jersey Law): Carey Olsen Jersey LLP 

• Trustee (English Law): Hogan Lovells Lee & Lee

Unique Feature of Transaction: Proceeds of the Bond issue will be utilized inter alia for funding the Take Private Transaction. This is a highly complex and unique matter, in terms of transaction structure and is one of first of its kind in India.

Innovative Feature of the transaction: Raising of foreign currency-denominated bonds for financing the proposed delisting of the fully paid-up equity shares of Vedanta Limited in accordance with the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house


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