* Offers 1 share and 4 redeemable shares for each Cairnshare
* Vedanta's initial deal stymied for a year
* New offer to be put to vote in September
* Cairn India shares rise 8.7 percent ahead of announcement
* Vedanta Ltd shares gained 7.4 percent
By Promit Mukherjee
MUMBAI, July 22 (Reuters) - India's Vedanta Ltd has offered to sweeten the terms for taking over subsidiaryCairn India Ltd after an initial bid had been stymiedfor a year.
Under the new offer, Vedanta will give one share and fourredeemable preference shares for each share in Cairn India, thecompany controlled by mining and metals tycoon Anil Agarwal saidin a statement on Friday.
Earlier it was offering one share and one redeemablepreference share for each Cairn share.
The deal, which will give debt-ridden Vedanta access to oiland gas explorer Cairn India's $3.5 billion cash pile, has facedopposition from some big minority shareholders. Vedanta must geton board Indian state-run Life Insurance Corp (LIC) and UK-basedCairn Energy Plc, which own 10 percent each in CairnIndia, to seal the takeover.
LIC and Cairn Energy declined to immediately comment on thenew offer on Friday.
Vedanta shareholders will vote on the new offer on Sept. 8,while Cairn India shareholders will vote on Sept. 12.
The new terms give a premium of 20 percent to thevolume-weighted average price of Cairn India's stock price overthe past month, Vedanta said.
One analyst said the new offer was in line with an increasein the shares of both companies since the deal was announced andwith recent greater stability in global crude oil prices.
"The revised terms seem definitely more attractive andconducive than (the offer) in the past," said Jigar Shah, chiefexecutive at Maybank Kimeng Securities India Pvt Ltd.
Navin Agarwal, chairman of Cairn India, had said on Thursdayhe expected the deal to be completed by the end of the currentfiscal year through March.
Ahead of the announcement, shares in Cairn India closed 8.7percent higher, their biggest single-day gain in seven years.Vedanta Ltd shares gained 7.4 percent.
London-listed Vedanta Resources Plc, parent ofVedanta Ltd, was trading up 5.3 percent by 1404 GMT. ($1 = 67.0732 Indian rupees) (Editing by Devidutta Tripathy and David Holmes)
