Shareholders of Vedanta Resources Plc
have approved the proposed acquisition of majority stake in Cairn India
for up to $9.6 billion, said an official of the London-listed mining group.
approved the transaction at an extraordinary general meeting (EGM) in London on Monday," said the official.
Vedanta on August 16 announced buying the Edinburgh-based Cairn Energy Plc's 40-51 per cent stake in its Indian unit and an additional 20 per cent through an open offer to minority shareholders of Cairn India.
According to the official, Vedanta has secured a syndicated term loan of up to $3.5 billion from a consortia of banks to fund the deal. It has taken two bridge loans of $1.5 billion and $1 billion to finance the transaction.
The company has missed the earlier deadline of seeking shareholders' approval by October 30, according to the schedule laid out by UK's Cairn Energy.
Billionaire Anil Agarwal-run Vedanta in the circular for the EGM stated the transaction is to be completed by April 15.
Oil Minister Murli Deora had on Monday stated the government will by March 2011 decide on giving approval to the Cairn-Vedanta deal.
After denying government role for months, Cairn had only late last month made applications for approval for transfer of control in all the 10 properties held by its Indian unit.
In the circular, Agarwal stated: "The acquisition is also subject to any required government of India consents having been given."
Vedanta also hopes to get Indian market regulator Securities and Exchange Board of India's (Sebi) nod for acquiring an additional 20 per cent stake from minority shareholders of Cairn India by month-end and may launch an open offer in the early part of January.
Besides the shareholder nod, the deal is also conditional on completion of the open offer. It will lapse if the conditions are not satisfied or waived on or before April 15.
Sources said if the government's nod was to come by March, it would be well within the April 15 deadline set by Cairn and Vedanta for closure of the transaction.
In the circular, Agarwal said the acquisition would establish Vedanta as a leading player in the Indian oil and gas sector.
"The acquisition will allow Vedanta to apply its core skills of project management and development of reserves and resources in conjunction with the technical knowledge and capabilities of Cairn India."
Cairn Energy had in October secured its shareholders' approval for selling most of its 62.38 per cent stake in the Indian unit, while Sesa Group, a Vedanta Group firm that will make an open offer for a 20 per cent stake in Cairn India, obtained approval from its shareholders on October 18.