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    Adani to buy Holcim’s India assets for $10bn, spend $3-3.5 bn to buy shares from public investors

    Adani to buy Holcim’s India assets for $10bn, spend $3-3.5 bn to buy shares from public investors

    Adani to buy Holcim’s India assets for $10bn, spend $3-3.5 bn to buy shares from public investors
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    By CNBCTV18.com  IST (Updated)

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    Holcim held 63.19 percent stake in Ambuja Cements and 54.53 percent in ACC. With a production capacity of 70 million tonne per annum, Adani will now become India's second largest cement manufacturer.

    In a $10.5 billion deal, the Adani Group on Sunday entered into definitive agreements to acquire Swiss cement major Holcim's stake in Ambuja Cements and its subsidiary ACC, including the open offers.
    According to reports, the Adani Group may spend $3-3.5 billion to buy public shareholders' shares.
    The Gautam Adani-led conglomerate has offered Rs 385 per share for Ambuja Cements while that for ACC at Rs 2,300, according to a stock exchange filing.
    Holcim held 63.19 percent stake in Ambuja Cements and 54.53 percent in ACC. Gautam Adani, Chairman of the Adani Group said that the company's move into cement business was another validation of their belief in nation's growth.
    With this, Adani will now become India's second largest cement manufacturer with a capacity to produce 70 million tonne of cement annually. Calling it  "India’s largest ever M&A transaction in the infrastructure and materials space" in an statement, Adani disclosed that the deal is valued at $10.5 billion.
    He added: "Holcim's global leadership in cement production and sustainability best practices brings to us some of the cutting-edge technologies that will allow us to accelerate the path to greener cement production.”
    Jan Jenisch, CEO of Holcim Limited said he was delighted that Adani Group was acquiring their business.
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    As compared to the global average of 525 kg per capita, India's cement consumption stands at just 242 kg per capita. Thus, the cement industry in India has a lot of potential for growth. Adani Group plans to create a "uniquely integrated and differentiated" business model with the cement business supporting its other infrastructure businesses, including ports, logistics, energy and real estate, said the company.
    ACC and Ambuja Cement have a combined production capacity of 70 MTPA including, 23 cement plants, 14 grinding stations, 80 ready-mix concrete plants and over 50,000 channel partners across India. Ambuja and ACC will benefit from synergies with the integrated Adani infrastructure platform, especially in the areas of raw material, renewable power and logistics.
    The joint statement by Adani Group and Holcim further said: "This will enable higher margins and return on capital employed for the two companies. The Companies will also benefit from Adani’s focus on ESG, Circular Economy and Capital Management Philosophy. The businesses will continue to be deeply aligned to UN Sustainability Development Goals with clear focus on SDG 6 (Clean Water and Sanitation), SDG 7 (Affordable and Clean Energy), SDG 11 (Sustainable Cities and Communities) and SDG 13 (Climate Action)."
    With inputs from Nigel Dsouza
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