Vedanta Ltd’s share price sank at open on Tuesday after electronics manufacturer Foxconn pulled the plug on a $19.5 billion (₹1.6 lakh crore) joint venture to manufacture semiconductors in India.
What Happened? "Foxconn has determined it will not move forward on the joint venture with Vedanta," the Taiwan-based company said in a statement on Monday.
The company said it had worked on realising its semiconductor ambitions with Vedanta for over a year but the two firms had mutually decided to dump the joint venture. Foxconn said it will remove its name from the entity, which is now fully owned by Vedanta.
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It was previously reported that Foxconn was seeking partnerships with other Indian businesses to fulfil its semiconductor manufacturing plans in the country, moving away from joint-venture partner Vedanta Group.
The reports suggested that differences had appeared with Vedanta Group over the changes to be made in reapplying for incentives under the government's $10 billion (₹82,000 crore) Indian Semiconductor Mission after their first application was reportedly rejected for not meeting the government's criteria.
Vedanta has been on a borrowing spree recently as it looks to service a large amount of debt it has accumulated since the sale of its zinc-mining unit to its subsidiary, Hindustan Zinc, fell through.
Price Action: Vedanta’s share price dropped 1.47% to trade at ₹278.10 in early morning trade on Tuesday.
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