Vedanta's $1.5bn bond sale to fund Cairn deal
Vedanta, which will become a fully-fledged diversified miner once it secures a slice of India's oil reserves, said the proceeds from the bond would be used to repay a bridge loan, part of the purchase price, fees and expenses related to the protracted Cairn deal.
If the sale does not go ahead then the miner said it would use the cash to "fund capital expenditure, repay debt and for other general corporate purposes".
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Hide AdCairn Energy agreed in August to sell a majority stake in its Indian offshoot to Vedanta, but the deal has been delayed due to a dispute over royalty payments.
A panel of Indian ministers is expected to meet on 27 May to consider the sale. On Thursday, Cairn and Vedanta extended the deadline for the deal until after the ministers meet.
Vedanta will start a series of investor meetings on Monday to market the bond across Asia, Europe and the United States.
At Cairn Energy's AGM in Edinburgh on Thursday, chief executive Sir Bill Gammell told shareholders that he believed the agreement was still "likely" to go ahead.
If the deal is not completed then Gammell said one of the options for the firm would be to sell a small stake in Cairn India in order to fund exploration off the coast of Greenland.
But he highlighted Cairn India's capacity to increase production as it brings additional fields on line in the state of Rajasthan. With oil prices rising, profits from Cairn India could fund other drilling activity.
Capricorn, Cairn's exploration business, is expected to drill up to four test wells off the coast of Greenland this summer.
If the wells are unsuccessful - as were last year's three sites - then Gammell said the company would look at other potential fields near its present drilling range.