Vedanta may buy Cairn stake

Aug 12, 2010 |

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Aug. 12: Billionaire Mr Anil Agarwal-owned mining firm Vedanta Resources on Thursady said it is in talks to buy a stake in Cairn India, the company that owns the nation’s largest onland oilfield.

The London-listed firm said “discussions are taking place with Cairn Energy Plc regarding an acquisition of an interest in Cairn India Ltd, a company listed in India.” Cairn Energy, which holds a 62.37 per cent stake in Cairn India, also confirmed the discussions in an almost identical separate statement.

This is not the first time that talks of Cairn Energy selling a stake have emerged. Over the past 2-3 years, the Edinburgh-based firm has been rumoured to have been in discussions with steel tycoon Mr L N Mittal and Italy’s Eni Spa, among others, for an outright sale of its interest in Cairn India, or at least the sale of an asset.

The stake sale talks have resurfaced just when the Mangala oilfield in Rajasthan, Cairn’s most prolific asset, is nearing peak output of 125,000 barrels per day.

If it is successful, Vedanta — which has iron ore, zinc and copper mines — will be the second largest miner in the world after BHP Billiton to have an interest in oil.

The talks are in advanced stages and Vedanta may be discussing options such as including an equity stake, asset purchase or a complete takeover .

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