With this, the Edinburg-based firm's shareholding in the Indian entity will come down from 21.79% to around 18.3%. The company had earlier sold 40% stake in Cairn India to London-based mining company Vedanta Resources as part of its plan to exit from India.
At the general meeting of the company held on May 17, 2012, shareholders authorised the board to dispose of all or part of Cairn's residual interest in Cairn India. The company has reached an agreement with Citi to complete an on-market sale of a total of 66,758,864 shares in Cair India, representing approximately a 3.5% shareholding in Cairn India, the company said in a statement.
Though the British major earlier claimed to continue to hold interest in the country's hydrocarbon business, it seems that delays in government approvals and unstable policies have forced foreign majors to change their perspective. Earlier, companies like Petrobas of Brazil and London based BG Group exited India.
Cairn expects to receive from this disposal a cash consideration, which will be used to help fund Cairn's stated strategy and provide greater operational flexibility, the company said.