Vedanta Ltd invites EoI to sell Sterlite Copper factory in Thoothukudi

Vedanta Ltd, led by Anil Agarwal, has invited interested parties to express their interest in selling its Sterlite Copper unit in Thoothukudi, Tamil Nadu.

The last day to submit the Expression of Interest is July 4th. Vedanta has invited bids in conjunction with Axis Capital. It was in May 2018 that 13 people were killed and around 102 injured in a police shooting on Thoothukudi, during a protest against the expansion of the factory. Following this, the smelter and refining complex was closed. Sterlite Copper had claimed that the shutdown of production at its Thoothukudi unit had resulted in a loss of more than $1.2 billion for the country.

About 120,000 people were affected due to the closure and almost 400 MSMEs were affected as they depended on products like copper, sulfuric acid and fluorosilicic acid. According to one estimate, the region was suffering a loss of around Rs 700 crore a year due to the shutdown. The plant produced about 40% of India’s copper demand and contributed about Rs 2,500 crore to the Treasury, 12% of Thoothukudi Port’s revenue and 95% sulfuric acid market share in Tamil Nadu.

Read also : Vedanta to raise up to Rs 4,089 cr via non-convertible debentures

The copper smelter, with a capacity of 400,000 metric tons per annum (MTPA), contributed to a greater share of the country’s demand for refined copper and included a copper refinery and rod plant, a sulfuric acid plant of more than 12,000,000 million tons per annum (MTPA) and a phosphoric acid plant of 220,000 MTPA. It also had a 160 megawatt (MW) coal-fired power plant to power the copper smelter.

The genesis of the problem in 2018 was when the company went into expansion mode. Sterlite wanted to double the capacity from 400,000 tons to 800,000 tons. After the shutdown, the Tamil Nadu government informed the Madras High Court in 2019 that there were 84 incidents of gas leaks from the plant in 2013 alone.

Concerns over the impact of the global recession on metals and demand for rough have led to lower prices for commodities such as aluminum and oil.

On Monday, Vedanta stock was down 10.5% at Rs 236 as of 11:17 a.m. India time.

Dear reader,

Business Standard has always endeavored to provide up-to-date information and commentary on developments that matter to you and that have wider political and economic implications for the country and the world. Your constant encouragement and feedback on how to improve our offering has only strengthened our resolve and commitment to these ideals. Even in these challenging times stemming from Covid-19, we remain committed to keeping you informed and updated with credible news, authoritative opinions and incisive commentary on relevant topical issues.
However, we have a request.

As we battle the economic impact of the pandemic, we need your support even more so that we can continue to bring you more great content. Our subscription model has received an encouraging response from many of you who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of bringing you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practice the journalism we are committed to.

Support quality journalism and subscribe to Business Standard.

digital editor