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Cairn India Approves Up To $917 Mln Share Buyback

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Oil and gas explorer Cairn India, a unit of London-listed Vedanta Resources Plc, said its board had approved a share buyback worth up to Rs 57.25 billion.

The share purchase, which will start in January, will be at a maximum of Rs 335 a share, the firm said in a statement after (26 November) Tuesday's market close. This represents a 3.33 per cent premium to Cairn India's closing price of Rs 324.20.

Mining conglomerate Vedanta, controlled by billionaire Anil Agarwal, acquired a majority stake in Cairn India for almost $9 billion in 2011. Cairn Energy owns 10.3 per cent of Cairn India, but Vedanta said the buyback was not specifically aimed at reducing that stake.

Cairn India said the buyback would result in a maximum reduction of its equity capital by about 8.9 per cent.

The buyback comes against a backdrop of strong cash flows generated by the Cairn India.

Chief Financial Officer Sudhir Mathur said in the statement that the company continued to work on its $3 billion, three-year capital expenditure programme and was well placed to develop its asset base.

(Reuters)