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A day before the crucial meeting in the petroleum ministry, senior executives of Cairn India on Saturday met to chalk out a strategy for tomorrowâs talks with the Indian government on the issue of Cairn Energy Plcâs stake sale in the company to London-listed Vedanta group. The deal, announced on August 16, has been awaiting government clearance. Officials from the Ministry of Petroleum and Natural Gas would hold a meeting on Sunday with senior executives of the two companies on the issue of government clearance.
The ministry, under the then petroleum minister, Murli Deora, had asserted its power to clear the deal, forcing Cairn Plc to seek government clearance under the production sharing contracts signed for several blocks.
The meeting would be chaired by Petroleum Secretary S Sundareshan. While Carin would be represented by Cairn Chairman Bill Gammell and Managing Director Rahul Dhir, Vedanta would be represented by CFO Tarun Jain and Chief Executive Officer MS Mehta.
The government approval is crucial since the market regulator has not cleared the mandatory open offer for the Bombay Stock Exchange-listed Cairn India. The proposed deal, which could see Vedanta spending up to $9.6 billion to acquire 51-60 per cent in Cairn India, has not gone down well with Oil and Natural Gas Corporation that is a partner with Cairn India in all its three producing blocks besides five other blocks.
Though ONGC has ruled out any counter offer, it rues the fact that it has to pay the entire royalty amount on Barmer production despite being a 30 per cent partner in the field.