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10 Pages

Vedanta to acquire a controlling stake in Cairn India

Vedanta to acquire a controlling stake in Cairn India

Report summary

of 21.7%Vedanta Resources is to acquire a 51% stake in Cairn India from Cairn Energy for US$8.48 billion (subject to change, contingent upon the response to a separate offer to other Cairn India shareholders). Under our base case analysis, we value a 51% stake in Cairn India at US$4.27 billion (NPV10, as at August 2010). Although this valuation is based on a 2P reserve figure greater than that reported by Cairn India, it is nonetheless significantly below the purchase price. The ...

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The upstream oil and gas industry conducts activities against a backdrop of growing energy and environmental challenges. Political instabilities, international conflicts and government and environmental regulation have all impacted the production process.

This has forced companies to re-examine their corporate strategy, moving away from high-risk exploratory drilling to lower-risk exploration in mature basins as they search for increased returns.

This Upstream Oil and Gas Deal Insight report provides an in-depth analysis of this deal. You will also find information about upstream assets and the strategic rationale behind the deal.

For investors and businesses, this deal insight report provides an understanding of the effect this deal will have on the market, including oil and gas pricing and assumptions. Use it to keep up to date with deal announcements, gain expert insights and analyse potential developments that might affect your strategy.

Wood Mackenzie goes beyond company-reported data and announcements to give you an independent and informed view. Our unique valuation metrics are underpinned by our deep understanding of upstream assets and companies. We help you objectively benchmark and evaluate asset and corporate deals so you can compare deal economics around the world.

  • Executive summary
  • Transaction details
  • Upstream assets
    • RJ-ON-90/1 (Rajasthan)
    • Ravva
    • CB-OS/2
    • Other
  • Deal analysis
  • Upsides and risks
    • Potential pre-emption by ONGC
  • Strategic rationale
    • Cairn Energy
    • Vedanta
  • Oil & gas pricing and assumptions

In this report there are 8 tables or charts, including:

  • Executive summary
  • Transaction details
  • Upstream assets
    • Upstream assets: Table 1
    • Wood Mackenzie base case production and capex forecasts (net Vedanta*)
  • Deal analysis
    • Deal analysis: Table 1
    • Deal analysis: Table 2
  • Upsides and risks
    • Upside scenario modelling - production and capex assumptions (net Vedanta*)
    • Upsides and risks: Table 1
  • Strategic rationale
  • Oil & gas pricing and assumptions
    • Oil & gas pricing and assumptions: Table 1
    • Oil & gas pricing and assumptions: Table 2
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