Vedanta to miss deadline on getting investors’ nod
New Delhi, Oct. 25: London-listed Vedanta Resources is set to miss the October 30 deadline for seeking shareholders’ nod for its $9.6 billion buyout of Cairn India, apparently due to regulatory hurdles.
The deal is conditional upon Cairn Energy Plc (which is selling a majority stake in its Indian arm) and Vedanta Resources securing shareholders’ approval on or before October 30. Furthermore, the Vedanta Group has to complete an Indian open offer to minority shareholders of Cairn India.
While shareholders of Cairn Energy approved the sale of a 40 to 51 per cent stake in Cairn India to Vedanta on October 7, Vedanta has so far not secured the nod of the United Kingdom Listing Authority for convening an extraordinary general meeting of shareholders, sources in-the-know of the development said.
Once the UK Listing Authority gives its consent, Vedanta will publish a notice convening a shareholders’ meeting within 21 days from that date.
A company spokesperson did not immediately respond to queries seeking comment on the issue.
Sources said Vedanta Group firm Sesa Goa’s offer for buying up to a 20 per cent stake in Cairn India from minority shareholders, too, could not open on the scheduled date of October 11 due to delays in getting Sebi’s nod.
Sebi apparently withheld approval for the open offer after the oil ministry wrote to it saying Cairn Energy needs government approval before it can transfer a controlling stake in key assets like the giant Rajasthan oilfields to Vedanta.
While Cairn Energy is in the process of seeking the government’s nod, ONGC, which partners the company in Rajasthan, has also asserted its preemption rights and wants the UK-based firm to seek its explicit nod before selling a stake in its Indian subsidiary.
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