London: British oil explorer Cairn Energy expects to finalise a long-awaited deal to sell control of its Indian business by mid-September, bringing to conclusion a process that has dragged on for almost a year.
India in June granted conditional approval for Vedanta Resources to buy a stake in Cairn India in a $6 billion deal that was first announced in August 2010.
Cairn India is currently seeking approval from its shareholders on the conditions imposed by the Indian government via postal ballot.
"Cairn Energy has set out a timetable for shareholder approval by September 14," a source close to the company told Reuters on Wednesday.
Analysts expect Cairn India shareholders to approve the conditions, following which Cairn and Vedanta will be able to complete the deal. Cairn originally predicted that the sale of its stakes to Vedanta would be finalised by the end of 2010.
The mid-September timetable for shareholder approval is in line with what Vedanta officials indicated in late July when they said they expected the deal to complete within six weeks to two months.
The parties had agreed to satisfy India's conditions by the end of August, including an undertaking from Cairn India that it and state-controlled ONGC would share the burden of royalty payments that are currently only paid by ONGC.
"Cairn Energy is working to satisfy the conditions set by the government of India to the agreed timetable," said a spokesman for Cairn Energy.
Vedanta declined to comment.
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