SEBI Reg. Investment Advisor

Download App

MoneyWorks4Me

Cairn Energy removes non-compete fee on Vedanta deal

28 Jun 2011 Evaluate

Cairn India’s Scottish explorer - Cairn Energy agreed to lower price at which it will sell up to 40% stake in its Indian unit to mining group Vedanta Resources, possibly taking into account the stringent condition the government has put for approving the deal.

The company has now decided to do away with Rs 50 per share non-compete fee and will now sell 40% stake in Cairn India in two tranches at Rs 355 per share. The Edinburgh-based firm will now get $6.02 billion from sale of majority of its 62.4% stake in Cairn India to London-listed mining group.

Certain adjustments are accepted by Cairn and Vedanta including transaction sale and purchase agreement for the sale of part of Cairn Energy PLC's shareholding in Cairn India, involving the removal of the non-compete arrangements and associated fee, which are expected to result in a 5.3% reduction in post-tax proceeds. The operation will be done in two tranches - an initial sale of a 10% stake in Cairn India, and a subsequent sale of a 30% stake which remains subject to receipt of the necessary consents and approvals from the government of India.

Gross proceeds for the sale of a 40% interest in Cairn India will amount to $6.023 billion with net proceeds expected to be approximately $5.408 billion in cash.

Peers
Company Name CMP
ONGC 283.95
Oil India 470.10
Jindal Drilling&Inds 540.15
Deep Industries 476.90
Asian Energy Service 306.05
View more..

About MoneyWorks4Me

MoneyWorks4Me is a SEBI-registered Investment Adviser (IA) dedicated to helping investors build long-term wealth through transparent, research-driven, conflict-free guidance. Founded in 2008, we started our journey as a Research Analyst (RA), providing deep fundamental analysis, intrinsic value insights, and long-term investing frameworks for Indian equities. In 2017, we transitioned to a full-fledged SEBI-registered Investment Adviser, strengthening our commitment to acting as a fiduciary—always putting the investor’s interest first.

Our Vision

To become India’s most trusted, research-powered fiduciary advisory platform—where every investor, regardless of experience, can make calm, confident, and well-reasoned investment decisions.

What Makes MoneyWorks4Me Different

Our Approach: Ensuring compounding work its magic on client portfolio.

MoneyWorks4Me ensures this through:

×