Bill Gammell, the CEO of Cairn Energy Plc, who is also an international rugby player, is in India to meet government authorities and also to be part of the ongoing Commonwealth Games. While he is confident that his multi-billion dollar transaction with Vedanta will soon see the light of the day, he is prepared to look at tougher alternatives in case the deal falls through due to lack of approvals from the government and market regulator. Excerpts from an interview to Hindustan Times.
What do you expect from the government and regulatory authorities at this time?
It is extremely difficult to say what the government will do. But all we can do is to go through the process. We will follow all approvals but what I want to make clear is that this is a corporate transaction and not an asset sale. Moreover, the deal is being looked at by global investors. If for some reason this transaction does not happen then it will send very wrong signal to the world markets in terms of investment process.
What are your expectations?
I remain hopeful and confident that this will go through by the first quarter of 2011. Even during our IPO (during 2007), this was a very hard thing to get done but it got done and was proved good for India and us. I am confident that our transaction with Vedanta will also go through. If it does not, it will raise concerns on how people can get returns on their capital investments in India.
The royalty issue is what is bothering ONGC (the 30 per cent stakeholder in the Rajasthan oil field)…
The royalty issue is not a new one and is going on for many years now. This is solely between the Indian government and ONGC and we are going exactly as per our production sharing contract which clearly says that ONGC will pick up the entire royalty tab. I sympathise with ONGC. But Cairn India has got nothing to do with this.
What if the government approval does not come?
If for whatever reason things change, then we still own 62 per cent in the company and we can look at all sorts of possibilities.