Cairn Energy selling 3.5% in India business: Sources

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Cairn Energy is selling about 3.5 per cent stake in its former unit Cairn India, two sources with direct knowledge said late Thursday, as the British oil explorer builds up cash to support its recent spate of acquisitions.

Cairn Energy plans to sell 66.8 million shares, or 3.5 per cent of the Indian company's equity, one of the sources told Reuters.

The second source said the company was selling around 66 million shares in the range of Rs 307.40-317.50, valuing the deal around $365 million, based on Thursday's exchange rate.

The order book for the deal will open on Friday, with Citigroup as the book runner, both sources said.

The identity of the buyers could not be ascertained immediately.

Earlier this month, Cairn Energy agreed to buy UK-focused Nautical Petroleum for $644 million, its second acquisition in three months as part of a move from its high-risk exploration strategy in Greenland, where its has failed to find oil in two years.

In April, it agreed to buy Agora Oil & Gas for $450 million.

Last year, Cairn sold controlling stake in Cairn India to London-listed miner Vedanta Resources in an $8.7 billion deal, but still retained 21.8 per cent shareholding in the Indian company, as of March 31.

Cairn Energy shares were up 2.1 per cent in London trading. Cairn India shares closed up 0.6 per cent at Rs 327.35 on Thursday.