Cairn Energy sees $1.8 bn from Indian flotation

London, Nov 1: British oil explorer Cairn Energy Plc said on Wednesday it expected proceeds of at least $1.8 billion from the proposed flotation of its Indian operations in December.

Cairn said in a statement that part of the proceeds, which will be $1.9 billion if an over allotment option is exercised in full, would be used to fund its ongoing business with the balance being returned to shareholders.

Cairn, which will hold an extraordinary shareholder meeting on Nov. 17 to vote on the planned flotation, also said it was trading in line with expectations.

On Oct. 12, Cairn said it would float around 30 percent of the shares in its Indian operations, less than some investors had hoped. Cairn first raised the possibility of a partial flotation of its Indian oil and gas assets -- which account for over 90 percent of the company's market value -- in March.

''A successful flotation is in the best strategic interests of the Cairn India business and will provide an opportunity to realise value for shareholders,'' Chief Executive Bill Gammell said in a statement on Wednesday.

Cairn shares shares closed at 1,755 pence on Tuesday to value the business at 2.81 billion pounds ($5.34 billion).

Reuters