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Overview

Bank of China contributes to $3 billion syndicated loan to facilitate Vedanta Resources' acquisition of Cairn India

Commitments (Constant USD, 2023)$227,299,430
Commitment Year•2011Country of Activity•IndiaDirect Recipient Country of Incorporation•United KingdomSector•Industry, Mining, ConstructionFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Sep 1, 2011
Start (actual)
Dec 8, 2011
End (actual)
Dec 8, 2011
Last repayment (originally scheduled)
Aug 31, 2013

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Funding agencies

State-owned Commercial Banks

  • Bank of China (BOC)

Cofinancing agencies

Private Sector

  • Barclays Bank PLC
  • Citigroup Inc.
  • Credit Suisse AG
  • Goldman Sachs Group, Inc.
  • JP Morgan
  • Morgan Stanley Bank, N.A.
  • Royal Bank of Scotland
  • Standard Chartered Bank PLC

Receiving agencies

Private Sector

  • Vedanta Resources plc

Loan description

Bank of China contribution to USD 3 billion syndicated loan to facilitate Vedanta Resources' acquisition of Cairn India

Interest type•UnknownMaturity•2 years

Narrative

Full Description

Project narrative

In September 2011, Bank of China contributed $200 million to a $3 billion, 2-year syndicated term loan agreement with Vedanta Resources Limited to facilitate its acquisition of a 59% ownership stake in Cairn India Limited (an oil and gas exploration and production company, headquartered in Gurgaon, India) for $7.857 billion. The borrowing terms of the loan are unknown. The other banks that participated in the loan syndicate included Barclays Capital, Citigroup, Credit Suisse, Goldman Sachs, JP Morgan PLC, Morgan Stanley Bank, The Royal Bank of Scotland and Standard Chartered Bank. The acquisition was finalized on December 8, 2011, after a series of negotiations and approvals, including ONGC's consent. The acquisition was widely regarded as a way for Vedanta Resources Limited to consolidate its position as a major diversified natural resources company, like BHP Billiton and Rio Tinto.

Staff comments

1. Vedanta Resources Limited is an Indian diversified mining company headquartered in London, United Kingdom. It is the largest mining and non-ferrous metals company in India and has mining operations in Australia and Zambia and oil and gas operations in three countries. 2. A useful overview of the transaction is provided by https://www.nishithdesai.com/fileadmin/user_upload/pdfs/Ma%20Lab/M%26A%20Lab_Cairn%20Vedanta_March0112.pdf