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Stake Sale
Cairn India to raise US$ 625 Million
Posted On : 2008-03-17 00:19:30( TIMEZONE : IST )
Cairn India has arranged a private placement of approximately Indian Rupees (Rs) 25,346 million / $ 625 million after entering an agreement with Petronas and Orient Global Tamarind Fund Pte Ltd further to which the investors have agreed to purchase a total of 113 million shares of Cairn India at Rs 224.30 per share.
The net proceeds of the private placement will be used to fund capital expenditure and for general corporate purposes.
The Board of Directors of Cairn India Ltd (CIL) at its meeting held on March 17, 2008 has approved the placement through a preferential issue of:
63,300,000 Equity shares of Rs 10 each fully paid up equity shares of the Company at a price of Rs 224.30 per share to Petronas
49,700,000 Equity shares of Rs 10 each fully paid up equity shares of the Company at a price of Rs 224.30 per share to Orient Global Tamarind Fund Pte Ltd.
These shares will be locked in for a period of one year from the date of allotment. Following the private placement, Petronas will own approximately 12.7%, of the equity share capital of CIL as enlarged by the private placement and Orient Global Tamarind Fund Pte Ltd will own approximately 2.6% of the enlarged equity share capital of CIL.
The above mentioned proposed preferential issue is being made in accordance with Section 81(1A) of the Companies Act 1956 and Chapter XIII of the SEBI (Disclosure and Investor Protection) Guidelines, 2000 and is subject to approval of the shareholders and applicable regulatory approvals. A meeting of the equity shareholders of the Company is proposed to be convened on April 16, 2008 for obtaining their approval to the aforesaid proposal.
The issue price represents a 0.46% premium to the average closing price on the National Stock Exchange of the last two trading days prior to the announcement.
Rahul Dhir Chief Executive officer of Cairn India said: "Cairn India is entering an exciting period of growth. The Company is confident of producing first commercial oil from Rajasthan in 2009. The private placement will help the Company towards meeting its investment plans and provide greater financial and operational flexibility. We are delighted to have investors like Petronas and Orient Global show their commitment to subscribe to Cairn India's business."