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Vedanta Prepares to Draw $3 BN Syndicated Loan Portion

  • With the home ministry now giving the final nod to the Cairn Vedanta deal, sources informed Bloomberg UTV that Vedanta may now have sent a draw-down notice to the consortium of banks late on Sunday. The company may draw $3 billion that syndicated loan portions to finance the deal.Sources said Vedanta may draw the entire sum today. Earlier on Monday, the home ministry has given a no objection certificate (NOC) to Vedanta to carry out the $6 billion deal. As we know the government came out in the open earlier saying that they will pass the deal after Cairn Energy pushed its Indian unit to agree to the cess and royalty terms that were put as riders.
  • Reports today have also confirmed that ONGC, which holds 30% interest in the Rajasthan field, has also given its consent to the deal. ONGC had a major dissent with the deal over the royalty cost that was being bourne by it till date. Now, with Cairn India agreeing to ONGCs proposition that 70% of the royalty that ONGC till now paid on behalf of Cairn India will become cost recoverable, the deal now has no issues to face, and Vedanta is now preparing itself to pay off Cairn for the acquisition as early as possible.

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