Vedanta and Cairn India on Monday announced a merger after the Board approved on the deal. Shares of Cairn India rallied on the announcement.
The merger of Cairn India and Vedanta Limited consolidates our position as India's leading diversified natural resources champion, uniquely positioned to support India's economic growth, Anil Agarwal, chairman of London-listed group parent firm Vedanta Resources Plc said.
The independent directors, at both Vedanta Limited and Cairn India, unanimously recommend the proposed combination, Anil Agarwal added further.
"This marks a significant step towards achieving our stated long term vision of a simplified group structure with alignment of interests between all shareholders for the creation of long term sustainable value," he added.
Shareholders in Cairn India, will receive 1 equity share in Vedanta limited. And one redeemable share with face value of Rs 10.
Cairn India listing will be cancelled following completion on the transaction. The transaction is expected to be tax-neutral for Vedanta limited, Cairn India and their shareholders under Indian law.
Shares of the Cairn India was seen trading at Rs 184.90, higher by 2.30 per cent on Bse at 11.55 AM IST. It touched intra-day high of Rs 187 during the trade.
Vedanta shares were seen trading lower marginally during the trade. Vedanta is a diversified natural resource company, whose business involves, exploring and processing minerals and Oil and gas.
Cairn India is one of the largest independent oil and gas exploration and production companies in India.