* Essar says to honour rights and obligations with Vodafone
* Vodafone buying out Essar's 33% in India JV for $5 bln
(Recasts with source comments, changes dateline from MUMBAI/LONDON)
By Devidutta Tripathy and Kate Holton
NEW DELHI/LONDON, April 8 (Reuters) - India's Essar is not looking for more money to exit its joint venture with Vodafone, a source told Reuters on Friday, after media reports suggested the two companies were set to lock horns again.
Vodafone announced a deal last month to pay a predetermined price of $5 billion to buy Essar out of Vodafone Essar to give it direct ownership of 75 percent of India's third-biggest operator and bring an end to their fractious relationship.
Essar, which has clashed openly with Vodafone during their partnership, declined to comment at the time.
On Friday, newspaper reports that did not identify their sources said the Indian group might ask for more money or seek some form of arbitration.
Essar said in a statement on Friday it intended to honour all its rights and obligations under the agreement.
A source familiar with the situation later told Reuters the group was not looking to extract more money.
Last month's agreement came about after Essar exercised its put option over 22 percent of the stake, allowing Vodafone to exercise its call option over the remaining 11 percent.
The source said Essar had already applied for the Indian central bank's permission to transfer the 11 percent stake in the venture to Vodafone for $1.2 billion.
The Economic Times had reported that Essar wanted $600 million-$700 million more from Vodafone to sell its 33 percent holding. The newspaper, citing unnamed sources, said Essar could invoke a Reserve Bank of India resolution that says Indian shares in privately held firms should be valued under the discounted cashflow method.
Under this method, Essar's 11 percent stake would be worth $1.8 to $1.9 billion, compared with the purchase option that puts it at $1.2 billion, the paper said.
"Essar fully intends to honor all its rights and obligations under the various agreements with Vodafone and also expects Vodafone to do the same," Essar said in its statement on Friday.
"This will be done in accordance with all applicable laws and regulatory approvals," Essar said.
A Vodafone spokesman in London declined to comment other than to point out that the agreement announced last month between the two sides was legally binding.
The two sides said the final settlement was expected to be made no later than November this year. (Additional reporting by Sumeet Chatterjee in Mumbai; Editing by Tony Munroe and Will Waterman)