Mumbai, April 11 (IANS) Natural resources major Vedanta Ltd. said on Tuesday that its merger with subsidiary energy firm Cairn India has become effective.
“Vedanta Limited (Vedanta) and Cairn India Limited (Cairn India) today (Tuesday) announced that the merger of Cairn India with Vedanta pursuant to the Scheme of Arrangement has become effective,” said both firms in a joint statement.
“This merger consolidates Vedanta’s position and the merged company will have a larger pro forma market cap of $15.6 billion and higher free float of 49.9 per cent. Vedanta will have one of the strongest balance sheets in the Indian corporate sector,” it said.
A statement last month had said Vedanta had received all approvals for the merger, except the Reserve Bank of India’s permission for issuing redeemable preference shares to Cairn India’s non-resident shareholders.
Shareholders of both Vedanta Ltd. and Cairn India had in separate meetings held last year approved the merger.
Under the merger scheme, a Cairn India shareholder will get one Vedanta equity share and 7.5 preference shares for every Cairn India share.
The Anil Agarwal led-Vedanta Ltd received approvals in September 2016 from both the Bombay Stock Exchange and the NSE on the company’s proposal to merge with Cairn India.
Merging Cairn India with itself provides Vedanta access to the oil explorer’s cash and help reduce its debt burden. Vedanta took majority control of Cairn India for $8.67 billion in 2011 and holds 59.9 per cent in it through its various units.
“We are pleased to have completed the Vedanta Ltd – Cairn India merger and are very excited about the future of the combined company,” Vedanta Chairman Navin Agarwal said in a statement.
This is published unedited from the IANS feed.