Anil Agarwal-led Cairn India on Tuesday announced spending up to Rs 5,725 crore to buy back shares, a move which would help promoter Vedanta Group to gain greater control over the oil producer without putting in any money.
Cairn, which is sitting on a cash pile of about $3 billion, in a statement said its board has approved buying 17.09 crore shares or 8.9 per cent of the total shareholding, from open market at no more than Rs 335 apiece. “The maximum Buyback price represents over 4 per cent premium compared to the average of the weekly high and low of the closing share price of the company during the last two weeks,” it said.
The buyback will start in January after shareholders nod and other sanctions and approvals are in place. Cairn, the largest private oil producer in the country, will offer to buy back shares, including 10.27 per cent held by its former promoter Cairn Energy Plc of UK, and extinguish them.