Vedanta to Buy Cairn India, Share Price Rises

Mining group Vedanta Resources said Monday that it plans to buy as much as 60% of oil producer Cairn India for a price of up to $9.6 billion in cash.

Vedanta (UK:VED 2,138, +85.00, +4.14%) said the deal will give it a controlling stake in a company that has the potential to generate around a quarter of India's oil and gas production.

Cairn India's parent company, Cairn Energy Plc, also zoomed nearly 2 per cent on the London Stock Exchange and was being quoted at 4.61 pounds in late afternoon trade.

In contrast, NRI billionaire Anil Agarwal-led Vedanta Resources Plc plunged by 5.5 per cent to 20.61 pounds on the LSE.

In addition, Sterlite Industries (BSE:500900) a Vedanta Group firm, sank by over 4 per cent to close at Rs 160.70 on the Bombay Stock Exchange. Sterlite was the biggest loser in the Sensex pack on Friday.

Cairn India, listed on the Bombay Stock Exchange, is one of the largest oil and gas companies in the country.

The deal is expected to close by the first quarter of next year at the latest. It has been cleared with regulators but awaits shareholder approval at both companies.

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