New Delhi: State-owned Oil & Natural Gas Corporation (ONGC), Oil India Ltd (OIL) and Gas Authority of India Ltd (GAIL) may make a joint bid to counter Vedanta Resources' $8.48 billion offer for majority stake in Cairn India, and have already got $10 billion in loan commitments from international banks for the move, reports PTI.

The oil ministry is believed to be uncomfortable with billionaire Anil Agarwal-owned Vedanta Group buying 51%-60% of Cairn India for $8.48 to $9.6 billion and has asked ONGC, OIL and GAIL to cobble up a joint bid to rival the London-listed miner.

The three firms have held informal talks on the joint bid even as the ministry is looking at legal options to deny Vedanta the approval necessary for conclusion of its deal with UK's Cairn Energy Plc, which holds 62.37% stake in Cairn India, sources familiar with the development said today.

"Deutsche Bank, Credit Suisse and UBS, the only three leading bankers who are not in conflict with the Vedanta-Cairn Energy deal, may be advising ONGC on the counter-bid," a source said. ONGC is the leader of the consortium with at least 50% share. OIL and GAIL will each be 20%-25% partners.

ONGC has got informal commitments for funding up to $10 billion for the takeover bid, another source said, adding that the ONGC-OIL-GAIL consortium may make a bid at more than the Rs405 a share offered by Vedanta.

Industry observers, however, took a dim view of the state owned firms taking ownership of Cairn India as it would not add to energy security of the country because the oilfields are already in India and producing and perhaps may not be able to add any value beyond what has already been created.

Value would have been added only if the public sector undertakings (PSUs) had used the money to acquire oil property abroad, they feel.

The message such a move would send to investors is that you can invest in India but cannot take money out, they said, adding that this would not augur well just when the next bidding for oil and gas blocks under the New Exploration Licensing Policy (NELP) is round the corner.

Oil ministry, a source said, was against Vedanta acquiring Cairn's stake because it was a non-oil company.

"They are operating under the presumption that Cairn India's skill sets are in London whereas the fact is that it is Cairn Energy which has leveraged on exploration and production (E&P) skills of Cairn India. They got qualified for the Iraqi bid round only on capabilities of Cairn India."

Sources said the ministry feels it holds the trump card on Vedanta-Cairn deal because it feels government approval is must. On the other hand, Cairn Energy fells the Vedanta deal is a corporate transfer and not sale of stake in an oil field that would have triggered need for regulatory approvals.

Cairn Energy could have sold its shareholding in the stock market and government could not have done anything, a source said, adding that Cairn India as a company continues to exist and only its shareholding is changing.