With the clock ticking away, Cairn Energy plc once again used its persuasive skills and sought clarity from the Government on the deadline for approving its proposed stake sale by in Cairn India Ltd to Vedanta Resources.

The Cairn Energy CEO and Chairman Cairn India, Sir Bill Gammell, met the Petroleum Secretary, Mr S. Sundareshan, here on Wednesday towards this purpose. Cairn Energy is sticking to its position that it does not intend to go back to its shareholders to extend the date beyond April 15 to complete the deal.

Sir Bill told newspersons that, “We continue to work in a consensual manner. We had a constructive dialogue. We stick to our position that the transaction has to be completed by April 15.”

“It is now in the Government's hand. I am positive and hopeful…see the transaction going forward.”

If Cairn and Vedanta fail to seek the mandatory regulatory approvals including Government nod for the deal, then the shareholders of Cairn Energy would have missed a prospect to monetise an exploration opportunity in India. In the absence of an approval before the set deadline, the two (Cairn Energy and Vedanta Resources) companies will need to reach a mutually agreed date and seek their shareholders approval for extension of the deadline.

The Petroleum Ministry is set to approach the Cabinet Committee on Economic Affairs (CCEA) to seek approval for the deal. The Petroleum Minister, Mr S. Jaipal Reddy, has maintained that, “there are issues relating to royalty and cess. We cannot sacrifice our position completely just to facilitate the deal.”

Related Topics
comment COMMENT NOW