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August 18, 2010 1:55 PM

Latham Leads on $9.6 Billion Indian Oil Buyout

Posted by Brian Baxter

London-based mining giant Vedanta Resources has tapped Latham & Watkins to advise on its acquisition of a controlling stake in the Indian oil and gas unit of Cairn Energy. The $9.6 billion deal will give Vedanta and its founder and chairman, Anil Agarwal, a significant slice of India's oil reserves with the acquisition of Cairn's huge Rajasthan oil field, Reuters reports.

Heading up Vedanta's legal team on the acquisition are Latham M&A partners Graeme Ward and Rory Negus in London, according to Legal Week. Ward joined Latham in January as the firm's first London lateral since October 2008. He previously worked at British firm Ashurst. Negus made partner last year along with 22 other Latham associates, Legal Week reports.

"Historically we have had strong connections with India in capital markets and through our Middle Eastern offices," Negus told Legal Week. "[T]his is definitely the start of a financially healthy economy looking to create more M&A activity."

Latham finance partners David Miles in Hong Kong and Rajiv Gupta in Singapore also advised Vedanta on the deal, according to Legally India. While Latham provided advice on English law to the company, Vedanta turned to Clifford Chance alliance partner AZB & Partners for Indian counsel. AZB founding partner Zia Mody and partners Shuva Mandal and Essaji Vahanvati advised Vedanta on the acquisition, Legally India reports.

Serving as outside counsel to Edinburgh-based Cairn Energy was Scottish firm Shepherd and Wedderburn. Corporate finance partners Paul Hally and Stephen Trombala are leading the team from the firm, Legal Week reports, and are being assisted on Indian legal matters by finance partner Uday Walia with New Delhi-based S&R Associates.

Legally India reports that S&R's relationship with Cairn's India unit began with Cairn India's spin-off from its Scottish parent in a late 2006 IPO. S&R advised the underwriters on the offering, and Walia told Legally India that his firm began picking up certain assignments for the company afterward.

Vedanta was the first Indian company to go public in the U.K., raising $876 million through an IPO in 2003. In May the company turned to Dewey & LeBoeuf for its $1.34 billion acquisition of zinc mines in Ireland, Namibia, and South Africa.

Vedanta now does business in India through its copper mining subsidiary Sterlite Industries, which lost out in a well-litigated bid for bankrupt Asarco late last year. The company says it hopes to expand its presence in India through the Cairn buyout, but it will have some competition as other investors seek a foothold in the emerging Indian energy market.

The Blackstone Group announced on Wednesday that it had invested $300 million for a stake in an Indian power project, which Bloomberg reports will be the private equity firm's largest investment in India.

We reached out to a spokeswoman for Simpson Thacher & Bartlett, which recently advised Blackstone on its $4.7 billion acquisition of energy company Dynegy, to see if the firm had a role in this deal as well. We'll let you know if we hear back.

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