Cairn India to spend $1 billion on buyback: Report

Cairn India, oil and gas unit of London-listed Vedanta Resources, is set to spend about $1 billion to buy back shares.

Citing two people with the matter, Bloomberg reported that the share purchase will include buying back Cairn Energy Plc's 10.3 per cent stake in the company.

Mining conglomerate Vedanta, controlled by billionaire Anil Agarwal, acquired a majority stake in Cairn India for almost $9 billion in 2011. Since then, Cairn India played a pivotal role in boosting revenue and production even as Vedanta's mining business in India faced regulatory hurdles and mining restrictions.

The plan may help Sesa Sterlite and Agarwal's other subsidiaries increase ownership in Cairn India to more than 65 per cent from 59 per cent, the source told Bloomberg.

Cairn India's board is expected to meet on November 26 to consider a buyback.

Vedanta and Cairn Energy could not immediately be reached for a comment outside regular business hours.

Earlier this month, Vedanta said Cairn India was on track to hit its 2014 production target, previously put at 225,000 barrels of oil equivalent per day.