Income Tax dept sells Cairn Energy shares in Vedanta
Cairn Energy said it would write down the value of its investment in Vedanta Ltd after Indian tax authorities sold $216 million worth of its shares in the Indian mining company to recover a part of Rs 10,247-crore demanded as retrospective tax.
The UK Company said it still holds about 3 per cent in Vedanta Ltd after the sale, while warning that it was possible that the Indian tax department might make further sales.
The write down will result in an impairment charge in the company’s half year results in September equal to the value of the total shares notified as having been sold by the tax department at that time, Cairn said.
Indian metals and mining group Vedanta Ltd last year completed its buyout of oil and gas explorer Cairn India Ltd, giving Cairn a shareholding of about 5 per cent in Vedanta plus an interest in preference shares. The investment was valued at about $1.1 billion at the end of 2017.