Petronas takes 10 per cent in Cairn India as pre-IPO float fetches Rs3,700 crore

23 November 2006

Mumbai: Petronas of Malaysia has picked up 17.65 crore shares of Cairn India Ltd – subsidiary of Scottish oil firm Cairn Energy Plc – forming about 10 per cent stake in the company that is to be listed on Bombay Stock Exchange by the end of next month.

Petroliam Nasional Berhad (Petronas) subscribed to 17.65 crore of a total of 20.96 crore shares of CIL in a pre-IPO private placement, Cairn said in a statement. The balance 3.31 crore shares are being subscribed for by a combination of Indian and international institutional investors, including Videocon.

"The pre-flotation private placing closed on November 22 and 20.96 crore Cairn India shares have been placed at a price of Rs176.48 per share, raising a total of Rs3,700 crore ($822.47 million)," Cairn said in the statement.

"We are delighted to have gained such substantial backing for our pre-flotation placement. The positive response confirms our belief that this is the best strategy for Cairn to develop and grow our world class business in India," said Bill Gammell, chief executive of Cairn Energy Plc.

The net public offer of Cairn India shares would now stand reduced from 53.84 crore to 32.88 crore. Cairn had originally planned to raise at least $1.8 billion through sale of 53.84 crore shares through a planned flotation on the Bombay Stock Exchange Ltd and National Stock Exchange of India Ltd.

The entry of Petronas in Cairn India is the "first public indication of support Cairn has had from the industry, which is another tick in the box for shareholders," analysts said.