Agarwal is evaluating the possibility of divesting a less than 5% stake in the Mumbai-listed company, said the people, who asked not to be identified as the information is private. Vedanta’s shares have fallen about 32% in the last 12 months, giving it a market value of about $12.6 billion. A 5% stake is worth about $630 million. A stake sale in Vedanta is a last resort for the billionaire and will only be considered if other fundraising options fail, the people said.

Agarwal’s Vedanta Resources Ltd., which owns about 70% of Vedanta, has been in talks with at least three banks for a loan of as much as $1 billion, Bloomberg News reported earlier this month. The discussions are ongoing and no final decisions have been made on the loan, the people said.

“Any talks of stake sale in Vedanta Ltd. is untrue and baseless,” a representative for the companies said in response to a Bloomberg News query.

Vedanta Resources may rely on dividends from its subsidiary Hindustan Zinc Ltd. to help repay the $400 million worth of dollar-denominated bonds due in April, according to a Bloomberg Intelligence report. Hindustan Zinc on Tuesday said it will pay an interim dividend of 26 rupees a share, or a total of about 110 billion rupees ($1.3 billion).

Surging interest rates globally have pressured low-rated borrowers with heavy debt loads like Vedanta’s. The Vedanta Group in January agreed to sell a zinc manufacturing business to its Subsidiary Hindustan Zinc for $2.98 billion in phases over 18 months. The Indian government, which owns about 30% of Hindustan Zinc, strongly opposed the deal.

Vedanta Resources slashed its net debt by $2 billion in the current financial year and will continue to deleverage from net debt of $7.7 billion in the next two financial years, the company said in an exchange filing in February. 

A self-made billionaire, Agarwal was looking to expand his business empire into a resources conglomerate like BHP Group Ltd. He was the largest shareholder of Anglo American Plc until 2019 when he exited his investment because his returns were “achieved even sooner than expected.” He tried but failed to take the cash-rich Vedanta private in 2020. Agarwal then considered a potential merger of his closely held Vedanta Resources and the Mumbai-traded company, Bloomberg News reported last year.

Agarwal built his fortunes on a series of ambitious acquisitions: In 2001, he bought control of then government-owned Bharat Aluminium Co. in one of the first tests of India’s efforts to offload state holdings. He followed that up with the purchase of another government entity, Hindustan Zinc. He successfully bid for what was India’s largest iron ore producer Sesa Goa Ltd. in 2007 and for Cairn India, despite having no oil and gas experience.