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Sesa Goa open offer for Cairn India delayed: Vedanta

Vedanta Chairman Anil Agarwal said the group firm's offer will not commence on Monday as had been planned earlier, since it is waiting for Sebi's nod.

twitter-logo PTI   Mumbai     Last Updated: October 11, 2010  | 13:40 IST

A Vedanta group firm's open offer for Cairn India will not commence on Monday as had been planned earlier, and the company would wait for market regulator Sebi's approval to launch the same, Group Chairman Anil Agarwal said.

"We will wait for the SEBI approval to launch the open offer for Cairn India," he told reporters

The offer by Sesa Goa, a subsidiary of Vedanta, to acquire an additional 20 per cent shares of Cairn India was to have opened on Monday.

London-listed Vedanta Resources is acquiring 40 to 51 per cent stake of UK's Cairn Energy Plc in the firm that owns the nation's largest onland oilfield for USD 8.48 billion.

Cairn Energy Plc had last week secured the approval of shareholders for sale of majority stake in its Indian arm to Vedanta Resources but the closure of the deal depends on certain conditions, including open offer from Sesa Goa.

As part of the acquisition, Sesa Goa had on August 17 filed papers for making an open offer, which was to open on Monday.

The group is, however, confident that the company would be able to complete the open offer transaction by early next year.

The deal, worth USD 9.6 billion including the open offer, is contingent upon Vedanta Group completing the open offer.

It is also conditional upon shareholders of Cairn Energy Plc, which holds 62.38 per cent stake in Cairn India, and Vedanta Resources passing a resolution to approve the transaction on or before October 30.

More importantly, the deal is conditional upon required government consent being obtained.

Industry sources said the market regulator may be waiting for the government to give its no-objection to the sale which is centred around the 6.5 billion barrel Rajasthan oilfields.

Oil Secretary S Sundareshan had a few weeks ago written to the SEBI chairman stating that the deal was contingent upon government approval, which has not yet been accorded.

The Supreme Court had earlier refused to restrain Vedanta Resources' subsidiary Sesa Goa from launching the open offer.

Sesa Goa is offering a price of Rs 355 per share, Rs 50 less than what Vedanta is paying Cairn Energy for the majority stake. The Rs 50 a share is the fee that Cairn Energy is charging from Vedanta for not competing with it in India, Sri Lanka and Bhutan for next three years.


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