VEDANTA-CAIRN

Vedanta Group Acquisition of Controlling

Stake in Cairn India
 VEDANTA
 Vedanta Resources plc is a diversified metals and mining
company with revenues in excess of US$6 billion. based
in London.
 
 They are the first Indian manufacturing company to be listed
on the London Stock Exchange.
 
 They have operating locations in India, Zambia and Australia.

 They are headquartered in London and have over 30,000

employees including over 8,000 professionals worldwide.
 
 
 TRANSACTION HIGHLIGHTS
 Vedanta Group to acquire 51% to 60% of Cairn India Limited
(“Cairn India”) for an aggregate consideration of
approximately US$8.5-9.6 billion in cash.
 Post completion it is expected that Vedanta Resources PLC
(“Vedanta”) will hold 31-40% of Cairn India directly and Sesa
Goa Ltd (“Sesa Goa“) will hold 20%
 Shares acquired from Cairn Energy PLC (“Cairn Energy”) to
be acquired at a price of INR355 per share; Vedanta will also
pay a non-compete fee of INR50 per share.
 Transaction to be funded through debt and cash resources
 Enhances and diversifies Vedanta’s strong growth pipeline
 Leverages Vedanta’s core skills and track record of value
creation
 CAIRN INDIA
 Cairn India is now one of the biggest private exploration and
production companies currently operating in India.

 The company was acquired by Caledonian Offshore Limited in

1988 and was renamed Cairn Energy PLC.

 Cairn India was listed on 9 January 2007 on the Bombay and

National Stock Exchanges.

 Cairn India currently has a market capitalisation in excess of USD

13 billion, ranking as the third largest oil and gas company in India.
Cairn India’s Asset Base
CAIRN INDIA:Sales And Growth
 Transaction Highlights
 Cairn to sell a maximum of 51 per cent of Cairn India to
Vedanta

 Consideration of up to US $8,480m (INR 396,561m),

based on US $8.66 (INR 405) per Cairn India share.

 A premium of approximately 32 per cent to the Cairn India

average closing price for 90 days prior to 14 August 2010

 Put and call options, exercisable after July 2012 and July
2013, to ensure a majority interest in Cairn India can be
sold (exercisable at US $8.66 (INR 405))
 Intention to return a substantial proportion of the
proceeds from the transaction to Cairn shareholders

 Retained cash will provide Cairn with financial

flexibility to pursue an active exploration programme in
its leading acreage position in Greenland and future
growth opportunities

 Continued exposure to Rajasthan through the retained

shareholding in Cairn India

 Completion expected before end of 2010

 Reasons for the Proposed Transaction

 A unique investment: the Indian natural resources

champion meeting the needs of a growing economy.

 Enhances and diversifies Vedanta’s strong growth

pipeline.

 Cairn India is a world class asset.

 Transaction Financing
 Transaction consideration of US$8.5bn to US$9.6bn
 Payable on completion (expected by Q1 2011)

Funding
 Vedanta Resources: bank debt facilities of up to
US$6.5bn, ≥ 2 year tenure
 Sesa Goa: c. US$3bn, primarily from cash resources
 Unique Opportunity to Create Value

 Creating an Indian natural resources champion:

comprehensive footprint across India’s resources sector.

 World class asset and management team.

 Leverages Vedanta’s core skills.

 Enhances and diversifies Vedanta’s strong growth profile.

 Financial flexibility retained and no impact on existing

expansion programmes.