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Ambuja Cements, an Adani Group company, has acquired Orient Cement for ₹8,100 crore, including the mandatory open offer.
The deal will be funded through internal accruals.
The company will also make an open offer to shareholders of Orient Cement for acquiring 26 per cent at ₹395 per equity share.
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The deal is expected to be completed in 3-4 months, said Ambuja Cements in a statement on Tuesday.
To start with, Ambuja Cements will acquire 7.76 crore equity shares of Orient Cement representing 38 per cent from the promoter group at ₹395.40 per share leading total investment of ₹3,185 crore.
The company has already signed a share purchase agreement with Amita Birla, Chandrakant Birla, Nirmala Birla, Avani Birla, Avanti Birla, Amer Investments (Delhi), Hindusthan Discounting Company, India Silica Magnesite Works, Jaipur Finance And Dairy Products, National Engineering Industries, Universal Trading Company, Bengal Rubber, Central India Industries, Gwalior Finance Corporation, Rajasthan Industries, Ashok Investment Corporation and Shekhavati Investments and Traders.
Separately, Ambuja Cements will also buy out 1.82 crore equity shares representing 8.90 per cent from certain public shareholders at ₹395.40 per share and executed agreement with Rukmani Birla Educational Society, Shri Jagannath Educational Institute, Sri Govinddeo Educational Institute, Shri Venkateshwara Educational Institute, Shri Hari Om Educational Institute, Shri Lakshminarayan Educational Institute, Calcutta Medical Institute and Calcutta Hospital Institute.
Ambuja Cements will also make an offer to purchase 5.34 crore equity shares, constituting 26 per cent at the same price, said the company in a statement.
Orient Cement turnover was up last fiscal at ₹3,185 crore, against ₹2,938 crore logged in same period last year. The turnover was at ₹2,725 crore in FY’22.
Orient Cement has 8.5 MTPA and can nearly double capacity by another 8.1 MTPA through brownfield expansion.
It also owns a high quality limestone mine at Chittorgarh (Rajasthan) that can support an additional 6 MTPA cement capacity in North India.
This will take Adani Cement operational capacity to 97.4 MTPA, accelerating its plans to achieve over 100 MTPA capacity by next March-end. The company had recently set itself ambitious goals for capacity expansion.
The deal will also help Ambuja Cements to increase its presence by 8.5 MTPA in the core market of South and West India and improve pan-India market share by 2 per cent.
The large limestone deposit at Chittorgarh (Rajasthan) provides the potential to increase cement grinding capacity by 6 MTPA in the attractive Northern Market (through split grinding unit), it said.
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