Adani-owned Ambuja Cements on Tuesday announced that it has signed a binding agreement for the acquisition of Orient Cement Ltd (OCL) at an equity value of Rs 8,100 crore. Ambuja will acquire 46.8 per cent shares of OCL from its current promoters and certain public shareholders and the acquisition will be fully funded through internal accruals, it said.
Ambuja Cements will purchase a 46.8 per cent stake in OCL from its existing promoters and select public shareholders for Rs 395.40 per share. The company is acquiring the stake at a 12 per cent premium to the last closing price. Additionally, it will make an open offer for an additional 26 per cent at Rs 395.40 to the shareholders of Orient Cement.
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Karan Adani, Director of Ambuja Cements, said, “This timed acquisition marks another significant step forward in Ambuja Cements’ accelerated growth journey, increasing cement capacity by ~30 MTPA within two years of Ambuja’s acquisition.”
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The acquisition will help Ambuja Cements reach 100 MTPA cement capacity in FY25 and increase its presence by 8.5 MTPA in the core market of South & West India. It will also help Ambuja Cements to improve its pan-India market share by 2 per cent. OCL also has additional 8.1 MTPA capacities which are in the Ready to Execute phase and construction can be started immediately. “OCL’s assets are highly efficient, equipped with railway sidings and well supported by captive power plants, renewable energy, WHRS and AFR facilities. OCL’s strategic locations, high-quality limestone reserves and requisite statutory approvals present an opportunity to increase cement capacity in the near term to 16.6 MTPA,” Karan Adani added.
CK Birla, Chairman of Orient Cement and the CK Birla Group, said, “The CK Birla Group is continuously reallocating capital to sharpen its focus on consumer centric, technology driven and service-based businesses.
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