Industrialist Anil Agarwal on Sunday announced the merger of his two group companies the oil and gas exploration major Cairn India into the natural resources arm Vedanta Ltd. Cairn shareholders will get one equity and one redeemable preference share of Vedanta.
The transaction is intended to be completed by the first quarter of 2016, the group said.
"The merger of Cairn India and Vedanta Ltd consolidates our position as India's leading diversified natural resources champion, uniquely positioned to support India's economic growth," chairman Agarwal said.
"The independent directors, at both Vedanta and Cairn India, unanimously recommend the proposed combination. This marks a significant step towards achieving our stated long term vision of a simplified group structure with alignment of interests between all shareholders for the creation of long term sustainable value."
The group, in a filing with stock exchanges on Sunday, said the strategy remains unchanged to continue focus on delivering attractive growth, sustainable development, long-term value for shareholders and to sustain strong dividend distribution.
"Approximately 752 million of each of equity shares and redeemable preference shares will be issued to the minority shareholders of Cairn India by Vedanta Limited pursuant to the merger,"it said, adding: "No shares will be issued to Vedanta Limited or any of its subsidiaries for their shareholding in Cairn India."
Vedanta Limited itself was created with the merger of Sesa Goa, Sterlite and Vedanta Aluminium.