Vedanta gets US$6bn for Cairn India acquisition

Vedanta Resources Plc announced that it has entered into financing agreements for US$6bn with a consortium of leading banks to fund the Vedanta Group's proposed acquisition of 51-60% of Cairn India Ltd. for an aggregate consideration of approximately US$8.5bn to US$9.6bn. Vedanta proposes to acquire 31%-40% and Vedanta's subsidiary Sesa Goa Ltd. will acquire a 20% stake in Cairn India. Anil Agarwal, Chairman of Vedanta Resources plc, said, "The financing announced provides the group with funding flexibility. We are delighted to announce US$6 billion of commitments from leading international banks, a testament to the strength of the Vedanta story."



Meanwhile, Cairn Energy Plc deputy CEO Michael Watts was quoted as saying that there was no guarantee in the proposed majority stake sale in its Indian arm to Vedanta Resources for US$9.6bn. "You can't guarantee these things because there are three parties: the government, ourselves and Vedanta. If it goes through or it doesn't go through it doesn't change the reality that it's a hell of a good project," Watts said. However, he was hopeful of closing the deal in the first quarter of 2011.

ONGC chairman R.S. Sharma said that the company will not create any impediments in the way of the Cairn-Vedanta deal. The Law Ministry is believed to have said that Cairn Energy cannot sell stake in its Indian unit to Vedanta Resources without the Government's approval for transfer of control in all its properties, including the Rajasthan oilfields.