Investors in the UK oil and gas firm Cairn Energy will be liable for payback of as much as $700 million as a result of the fuel giant's settlement in a long-running tax dispute with the Government of India, Bloomberg reported.
Chief Executive Officer Simon Thomson spoke to Bloomberg on a conference call and said, "We anticipate the return of capital to shareholders this year," adding that, "The Indian government is very focused on resolving this as quickly as possible and they are targeting completion within the next few weeks."
The company has said that it expects to reach a resolution in the "near term", which will allow it to distribute a special dividend and buy back shares, Bloomberg reported.
Further, Cairn said in a statement that the total amount payable to them will amount to around $1.06 billion, Bloomberg reported.
The energy giant will reportedly return the proceeds to its investors and spend the remaining cash on assets.
As part of India’s tax dispute with Cairn Energy, the fuel giant has sought to enforce the $1.7 billion arbitration award on the Indian government, and registered the arbitration award in other international jurisdictions, including the US, the UK, Canada, Singapore, Mauritius, France, and the Netherlands.
After scrapping the retrospective tax amendment, India has opened the gates to a resolution in other arbitration battles such as with Vodafone.
(With inputs from Bloomberg)