Cairn India Holdings Limited (CIHL), an overseas subsidiary of Vedanta Ltd, will exit its entire investment in Anglo American Plc, Vedanta said on Friday.
In December 2018, Cairn India Holdings purchased an economic interest through a structured investment in equity shares of Anglo-American Plc from Volcan Investments for a total consideration of Rs 3,812 crore.
This structure was to mature in parts in April 2020 and October 2020.
Volcan will exercise the early exchange option available to it on 26 July, 2019 and consequent to this the full exchange of its two issues of mandatory exchangeable bonds secured by shares in Anglo American plc, will settle on 12 August, 2019.
The share price of Anglo American has close to doubled since Volcan invested, delivering attractive gains to all investors, said Vedanta.
The investment by CIHL, which was entered into as part of its cash management activities, has delivered a net gain of over $100 million in the 8 month period it was held. Cash proceeds from the settlement of the transaction will be paid to CIHL on 13 August 2019, said Vedanta.
"Our strategy continues to be to focus on our existing businesses, where we believe that there are significant opportunities to unlock their full potential," Srinivasan Venkatakrishnan, CEO was quoted as saying.
Following the redemption of the structured instrument, completed with due Board approvals, CIHL will have no further economic exposure to Anglo American plc shares.