Vedanta Resources-Cairn India deal depends on shareholders approval

New Delhi, Aug 26 (Calcutta Tube) Corporate Affairs Minister Salman Khurshid said Wednesday the government will not have any problem with London-based Vedanta Resources acquiring Cairn India, if shareholders of the upstream oil company approve the deal.

‘If shareholders approve the deal then we do not have problem with it,’ Khurshid told reporters here on the sidelines of a conference.

Anil Agarwal-led Vedanta Group last week had announced a $8.5-$9.6 billion deal to buy 51-60 percent stake in the Indian arm of hydrocarbons explorer Cairn Energy to add another vertical to its portfolio.

‘If the shareholders have a problem they can come to us or the CLB or the High Court,’ Kurshid said when asked if the government would allow the deal to go through.

The Vedanta-Cairn deal is subject to government approval according to the production-sharing contract signed between the government and Cairn India. Cairn India’s three producing oil and gas assets, including the Rajasthan fields and seven exploration blocks, either have explicit provisions for seeking prior approval before transfer of interest or gives pre-emption, or the right of first refusal (ROFR), to partners like public sector ONGC.

Commenting on the Environment ministry halting bauxite mining by Vedanta in Orissa, Khurshid said: ‘Development is important, but it cannot be blindly pushed. Development must be under an agreed system of law.’

The government Tuesday withdrew environment clearance to Vedanta Resources to mine bauxite for the USD 1.7 billion aluminum project in Orissa.

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