Vedanta sees more C-suite exits amid crucial demerger and debt restructuring

Mumbai: Vedanta Group has seen several senior executives exit in recent months, adding to a top-level churn at the metals and mining conglomerate as it undergoes a significant demerger and debt restructuring.

Most recently, Krishnamohan Narayan, who joined Hindustan Zinc as deputy chief executive officer in April 2023, left the Vedanta group company last month, said two people in the know. He joins half a dozen senior executives who have left various Vedanta group firms in the past year, even as the parent company undertakes a significant effort to reduce its debt.

Narayan, who had joined Hindustan Zinc after a 28-year career at chemicals producer BASF, says on his LinkedIn page that he’s on a career break. He could not be reached for comment.

The C-suite exits may not have happened because of the restructuring, but if the senior executives were crucial to the exercise, then there could be an impact on it, said a partner at a top consulting firm.

“If posts like CFOs with strong balance sheets under them that will be part of the restructuring process leave, then in the initial days slowdown will happen in the work," this person said, adding that large conglomerates with several business units could have a couple of hundred C-suite executives.

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Some of the senior executives mentioned in this article exited within a year of joining the Anil Agarwal-led Vedanta group. Consultants say this level of churn among the senior leadership of a conglomerate this size is atypical, especially in the minerals and mining sector.

John Slaven, who had joined Vedanta Aluminium as chief executive in October 2023, exited last month. Sonal Shrivastava, a former regional finance chief at Holcim who took charge as Vedanta Ltd’s chief financial officer in June 2023, left within months, in October last year, shortly after the group announced its six-way carveout.

Sanjeev Gemawat left Vedanta in August after serving as group general counsel for a little more than two years to join Essar, while Omar Davis, who had been appointed as the parent firm Vedanta Resources Ltd’s president of strategy in March 2023, resigned in April this year. According to a Bloomberg report, Davis, a veteran banker based in London, had been overseeing the Vedanta group’s restructuring.

Cairn India Ltd, Vedanta’s oil and gas subsidiary, no longer mentions Nick Walker as chief executive, only featuring deputy CEO Steve Moore on its executive committee web page. Walker had been appointed as CEO in January 2023.

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“Employee attrition is a natural part of the lifecycle of any workforce and is common across industries," a Vedanta spokesperson said over email.

“We currently have approximately 300 topline leaders across the group including CXOs. Thus, 4-5 leaders quitting the company in a year’s timeline to pursue their own interests is normal by any industry standards. Therefore, the assertion you make is misleading," the spokesperson said.

The returnees

According to senior industry executives aware of the developments in the mining group, Vedanta, which has about 13,000 employees and 84,000 workers on its rolls, follows a pyramid structure in which 2-5% of the employees fall in the top bracket. The group offers competitive compensation packages for its senior executives, they said.

In the past four years, two CFOs have quit Vedanta, with incumbent Ajay Goel returning to the office in October last year, just five months after quitting his acting CFO role to join beleaguered edtech firm Byju’s. He had initially joined Vedanta as group deputy CFO in March 2021.

Between Goel’s two stints at Vedanta, Sonal Shrivastava briefly held the position of CFO. For her, too, it had been her second stint with the Vedanta group, having served as deputy CFO of Hindustan Zinc for eight months in 2017. Shrivastava declined to comment for this report.

Omar Davis was nearing 18 years of service at Bank of America when he was hired in April 2023 to manage Vedanta Vedanta Resources’s debt crisis out of London. Under Davis, Vedanta Resources recast its outstanding bonds worth $3.2 billion to push back the maturity date to ease the company’s swelling debt pile. The firm was to liquidate some non-core assets next to pare debt.

However, Davis left the firm in the midst of executing this strategy, barely 12 months after taking on the role. He did not respond to a request for comment.

Also read | Vedanta’s cost cut push is good, but some concerns linger

Vedanta’s spokesperson said the group was “committed to a culture of mutual respect and professionalism, empowering employees to take ownership of their work. Our business objectives are guided by thorough analysis and strategic planning, with clear and achievable goals that drive success. We prioritize providing our teams with the resources and autonomy they need to achieve their goals…"

Debt and a demerger

Vedanta is in the midst of a demerger that will see the group split into six separate listed companies—Vedanta Aluminium, Vedanta Oil and Gas, Vedanta Power, Vedanta Steel and Ferrous Materials, Vedanta Base Metals, and Vedanta Ltd.

Meanwhile, its London-based parent, Vedanta Resources, is focussing on paring its debt pile. The company had net debt of about $5.6 billion at the end of March, after deleveraing by $1.6 billion through 2023-24, as per its earnings presentation.

Ratings firm S&P Global in July noted that debt reduction was gradually making the company’s capital structure more sustainable, and that it could further cut borrowings by $1 billion over the course of this financial year. The ratings agency upgraded Vedanta Resources’ credit worthiness to B- from CCC+.

The bulk of the earnings at Vedanta Ltd and Hindustan Zinc are distributed as dividends to serve the capital needs of Vedanta Resources. In June, the company raised about $500 million by selling a 2.6% stake in Vedanta Ltd.

S&P analysts estimate that with the present debt reduction efforts, the London-based metals and mining conglomerate could lower its interest expense to $550-600 million by the end of this fiscal year from $800-850 million in FY24.

 

Corrigendum: An earlier version of this article mentioned that Shrikant Saboo, group head-commercial, marketing and risk, had resigned from Vedanta. After the article was published, Vedanta clarified that Saboo is still with the company.

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