India Business Journal - UltraTech buys out India Cements’ promoters’ stake for Rs 3,954 crore

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UltraTech buys out India Cements’ promoters’ stake for Rs 3,954 crore

IBJ Bureau
Jul 29, 2024

In a significant move, board of directors of UltraTech Cement has approved the purchase of a 32.72 per cent equity stake in India Cements from its promoters and associates. This decision follows UltraTech’s financial investment in June 2024, where it had acquired a 22.77 per cent equity stake at Rs 268 per share. The recent acquisition, valued at Rs 3,954 crore for 32.72 per cent equity at Rs 390 per share, is contingent on regulatory approvals and will trigger a mandatory open offer at the same price.

India Cements boasts of a total capacity of 14.45 mtpa of grey cement, with 12.95 mtpa in Tamil Nadu and 1.5 mtpa in Rajasthan. UltraTech’s acquisition is poised to enhance its ability to serve the southern markets significantly and accelerate its path to reaching an over 200-mtpa capacity.

Aditya Birla Group Chairman Kumar Mangalam Birla expressed enthusiasm about the acquisition, stating: “UltraTech Cement’s investments over the years, both organic and inorganic, have been designed to propel India to become a building solutions champion globally. Every investment in a core sector like cement accelerates economic activity and drives progress. These investments have also facilitated India’s nationwide infrastructure upgrade, powering our country’s growing need for housing, roads and other vital infrastructure. This, in turn, has had a tremendous impact on the lives and aspirations of people.”

He further added: “The India Cements opportunity is an exciting one as it enables UltraTech to serve the southern markets more effectively and also accelerates our path to 200+ mtpa capacity.”

UltraTech Cement, the flagship company of the Aditya Birla Group, is the third-largest cement producer in the world outside of China, with a total grey cement capacity of 154.86 mtpa. Committed to sustainability, UltraTech is a signatory to the GCCA Climate Ambition 2050 and the Net Zero Concrete Roadmap.