London Stock Exchange-listed Vedanta Resources, the company looking to acquire controlling stake in Cairn India, aims to cut its net debt of $1.97 billion.
“Vedanta sees Cairn India as a unique opportunity to develop its presence in the attractive oil and gas sector. Acquisition funding has been secured, shareholder approvals granted and the open offer for shares of Cairn India has been completed. The transaction is currently awaiting approval from the Government of India,” he said.
Agarwal said in an investor call that the Indian government should not link the royalty payment issue to its consent for the deal to acquire majority stake in Cairn India. “We expect the government would not link royalty issue with the deal,” Agarwal said in London on Thursday, adding, “it is a clear deal between two companies — Vedanta Resources and Cairn Energy Plc”.
The open offer was launched by Vedanta’s subsidiary Sesa Goa to acquire 20 per cent stake in Cairn India. However, only 8.1 per cent shares were tendered. Sesa Goa also acquired 10.4 per cent of shares of Cairn India from Petronas in a block transaction for $1,478 million.
The company on Thursday reported growth of 28 per cent in its profit at $770.8 million for the year ended March, on the back of a surge in prices across a wide range of commodities and record productions.
It had reported a profit of $602.3 million in 2009-10. The revenues surged by 44.1 per cent during the year at $11.42 billion via-a-vis $7.93 billion it had reported last year. Similarly, operating profit of the company was up 52.2 per cent at $2.53 billion during the year as compared to $1.66 billion of 2009-10.