Vedanta-Cairn India merger approved

Vedanta Limited (Vedanta) and Cairn India Limited (Cairn India) on Tuesday announced that the merger of Cairn India with Vedanta pursuant to the Scheme of Arrangement has become effective.

Being India's premier natural resources company, Vedanta provides the metals and energy to build India and fuel its growth. The combined entity is positioned to unlock India's wealth of world-class energy and mineral resources, thus enhancing oil and gas production, and preserving the 'Cairn' brand.

"The merger with Vedanta Ltd will de-risk Cairn India by providing access to a portfolio of diversified Tier-I, low cost, long-life assets, to deliver significant near term growth, while retaining the substantial upside from our oil and gas business," said Sudhir Mathur, Acting CEO of Cairn India.

Vedanta features on the sixth position in the list of global diversified natural resources companies, and the only one with majority of its sales to the growing Indian market. This merger consolidates Vedanta's position as one of the world's largest diversified natural resources companies, with world-class, low-cost assets in 'metals & mining' and 'oil & gas' divisions.

The merged company will have a larger pro forma market cap of USD 15.6 billion and higher free float of 49.9 percent. Vedanta will also be entitled to flexibility with regards to balance capital allocation to the highest return projects while providing a strong and stable dividend.

"With world class assets in metals & mining and oil & sas, Vedanta will fuel India's economic growth and generate value for all stakeholders," added Navin Agarwal, Chairman of Vedanta Limited.

On April 27, 2017, the list of shareholders of Cairn India to whom the equity and preference shares of Vedanta will be allotted as per terms of the scheme will be disclosed.

Shareholders of Cairn India will receive for each equity share held, one equity share in Vedanta of Rs.1 each (face value). Additionally, shareholders will be entitled to four 7.5 percent Redeemable Preference Share (RPS) in Vedanta with a face value of Rs. 10 each.

Cairn India shareholders, who will subsequently become shareholders of Vedanta, would also receive an interim dividend of Rs. 17.70 per equity share as approved by the Board of Vedanta on March 30, 2017.

No shares will be issued to Vedanta or any of its subsidiaries for their shareholding in Cairn India.