Cairn Energy to reduce Cairn India stake further

Oil exploration outfit Cairn Energy is in the process of selling an 8 per cent stake in Cairn India for up to 940m dollars, a source with direct knowledge of the matter has told Reuters.

That will be the second such deal in three months to pare holding in its former Indian unit. In June, Cairn Energy sold 3.5% of Cairn India to raise about $360m.

On top of that, Cairn Energy last year sold a controlling stake in Cairn India to London-listed miner Vedanta Resources in an $8.7bn deal.

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Cairn Energy held 18.3% of Cairn India as of end-June, stock exchange data showed and after its latest share offering, its stake will fall to about 10%.

The offering of nearly 153m shares has been made at between 317.90 and 328.30 rupees per share. The range represents a discount of between 5 to 8.7% from Cairn India's closing price of 345.55 rupees.

Citigroup is the sole book-runner for the transaction, the source said.

AB