HomeBusinessCairn Energy To Return $700 Million To Shareholders Through Special Dividend

Cairn Energy To Return $700 Million To Shareholders Through Special Dividend

Cairn Energy To Return $700 Million To Shareholders Through Special Dividend

Cairn Energy has stated it should return $700 million to shareholders by way of particular dividend

Britain’s Cairn Energy pledged to return as much as $700 million to shareholders by way of a particular dividend and a share buyback this 12 months, because it signalled a long-running billion greenback tax dispute with India could also be nearing an finish.

Oil and fuel producer Cairn, which has main operations within the nation, stated on Tuesday it was contemplating getting into into statutory undertakings with the federal government after adjustments to a retrospective tax legislation on the coronary heart of the row. Last month, India proposed scrapping the 2012 legislation and stated it might refund firms.

Cairn was awarded damages of over $1.2 billion final 12 months in a Dutch courtroom ruling which was challenged by New Delhi. “The Indian government is very focused on resolving this as quickly as possible and they’re targeting completion within the next few weeks,” Cairn Chief Executive Simon Thomson stated.

London-listed Cairn has been pursuing choices to grab Indian belongings abroad, together with these of nationwide service Air India, within the absence of a settlement. A decision would see it drop these instances as effectively.

“When we say shortly, we anticipate the near term resolution of this issue – that means all of our litigation, and the Indian government paying us the $1.06 billion,” Cairn’s Thomson added on a convention name, referring to the anticipated refund.

That quantity is simply wanting Cairn’s $1.35 billion market capitalisation worth, and $500 million could be paid out as a particular dividend, with $200 million earmarked for the buyback.

“This move implies that the recent developments in India have reached a point where (Cairn) is confident of recovering funds and putting the case behind it,” JPMorgan analysts stated.

Shares in Cairn, which initially rose as a lot as 8.2%, had been buying and selling 2.3 per cent greater at 199.5 pence at 0857 GMT

Cairn additionally posted a smaller working loss within the first-half and narrowed its 2021 outlook for manufacturing from its British belongings to a variety of 17,000 to 19,000 barrels per day.

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