Sept. 24 (Bloomberg) -- Cairn U.K. Holdings is selling a $940 million stake in Cairn India Ltd., according to terms of the sale obtained by Bloomberg.
Citigroup Inc. is offering 153 million Cairn India shares, representing about 8 percent of the company, to investors at a range of 317.90 rupees to 328.30 rupees apiece, the terms showed. Cairn India shares closed at 345.55 rupees today.
Cairn has pledged to sell down its remaining stake in Cairn India to free up cash for new projects after spending $1 billion on a two-year exploration campaign in Greenland that failed to find oil and gas. The company still owns about 18 percent of Cairn India after selling a 40 percent stake last year to Vedanta Resources Plc.
Cairn, based in Edinburgh, gained 0.4 percent in London to 285 pence. The company bought North Sea explorers Agora Oil & Gas AS and Nautical Petroleum Plc this year. Last month it said it will buy exploration acreage in Morocco.
“Cairn has bought into a strong development program in the North Sea that will require a substantial amount of capital expenditure,” said Stuart Joyner, an analyst at Investec Securities Ltd. in London. “Cairn India is no longer strategic and the shareholding is a source of funds for future development.”
Cairn raised about $365 million from selling a stake in Cairn India in June at 308.73 rupees a share. The shares fell after the price was at the lower end of the target range.