MUMBAI (Reuters) - Oil and gas explorer Cairn India Ltd , a unit of London-listed Vedanta Resources Plc , said its board had approved a share buyback worth up to 57.25 billion rupees.
The share purchase, which will start in January, will be at a maximum of 335 rupees a share, the firm said in a statement after Tuesday's market close. This represents a 3.33 percent premium to Cairn India's closing price of 324.20 rupees.
Mining conglomerate Vedanta, controlled by billionaire Anil Agarwal, acquired a majority stake in Cairn India for almost $9 billion in 2011. Cairn Energy owns 10.3 percent of Cairn India, but Vedanta said the buyback was not specifically aimed at reducing that stake.
Cairn India said the buyback would result in a maximum reduction of its equity capital by about 8.9 percent.
The buyback comes against a backdrop of strong cash flows generated by the Cairn India.
Chief Financial Officer Sudhir Mathur said in the statement that the company continued to work on its $3 billion, three-year capital expenditure programme and was well placed to develop its asset base.
(Reporting by Archana Narayanan and Prashant Mehra; Additional reporting by Clara Ferreira-Marques; Editing by David Holmes)