Vedanta picks up 10.4% in Cairn India as Petronas exits | business | Hindustan Times
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Vedanta picks up 10.4% in Cairn India as Petronas exits

business Updated: Apr 20, 2011 01:25 IST
HT Correspondent
HT Correspondent
Hindustan Times
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Still waiting for the government's nod to seal its acquisition of a majority stake in Cairn India, Anil Agarwal-led Vedanta Group on Tuesday bought a new 10.4% stake in Cairn India from Petronas International Corporation on Tuesday through its subsidiary, Sesa Goa, for Rs 6,620 crore.

"Sesa Goa announces that it has acquired 200 million shares amounting to 10.4% stake in Cairn India from Petronas International Corporation at a price of R331 per share," the company said in an statement issued to Bombay Stock Exchange.

The company said this acquisition is in addition to the open offer it launched on April 11, which is running till April 30. In keeping with the guidelines of regulator Securities and Exchange Board of India (Sebi), Sesa Goa launched the open offer to buy up to 20% of equity stake in Cairn India.

Vedanta and Cairn Energy have already extended the deadline to close the deal to May 20, as they have not received the Union Government's approval before the previous deadline of April 15.

Experts say Vedanta's action in buying the stake of Petronas speaks volumes of its confidence in getting government clearance for its deal.

"I think they have confidence in getting the approval otherwise they would not have gone ahead with buying Petronas shares in Cairn India," said Alex Mathew, head of research at Geojit BNP Paribas Financial Services.

With this move even if the open offer does not receive good response, Vedanta will have substantial stake in the company if the government clears the previous stake buy.

Cairn India's stocks jumped by 2.3% on BSE on Tuesday, while Sesa Goa rose by 0.7%.

Earlier this month the government had referred the matter to a group of ministers, headed by finance minister Pranab Mukherjee, to take a final call as the deal involved complex issues of royalty and cess.

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