Adani bags Holcim assets for $10.5 bn
New Delhi, May 15: Asia's richest man Gautam Adani's group on Sunday said it has clinched a deal to acquire a controlling stake in Holcim Ltd's businesses in India for $10.5 billion, marking the ports-to-energy conglomerate's entry into the cement sector. The Adani Group will acquire 63.1 per cent of Ambuja Cements Ltd along with related assets. Ambuja's local subsidiaries include ACC Ltd, which is also publicly traded.
"The Adani Family, through an offshore special purpose vehicle, announced that it had entered into definitive agreements for the acquisition of Switzerlandbased Holcim Ltd's entire stake in two of India's leading cement companies — Ambuja Cements Ltd and ACC Ltd," the group said in a statement.
Holcim, through its subsidiaries, holds 63.19 per cent in Ambuja Cements and 54.53 per cent in ACC (of which 50.05 per cent is held through Ambuja Cements).
"The value for the Holcim stake and open offer consideration for Ambuja Cements and ACC is $10.5 billion, which makes this the largest-ever acquisition by Adani, and India's largest-ever M&A transaction in the infrastructure and materials space," the statement said.
Holcim in a statement said, "The corresponding offer share prices of Rs 385 for Ambuja Cement and Rs
2,300 for ACC translate into cash proceeds of CHF
6.4 billion (Swiss Franc) for Holcim."
Adani has in the last couple of years diversified beyond its core business of operating ports, power plants and coal mines into airports, data centres and clean energy.
The group had last year set up two cement subsidiaries—Adani Cemenation Ltd, which was planning to set up two cement units at Dahej in Gujarat and Raigarh in Maharashtra; and Adani Cement Ltd.
The world's largest cement maker Holcim last month announced its exit from the country after struggling here for long. The company through two listed entities ACC and Ambuja has 66 million tonnes per annum capacity (mtpa).
Holcim was in talks with several business houses including Aditya Birla
Group, which owns the leading cement player UltraTech, and JSW Group.
The Holcim group, which had entered the market 17 years ago, holds a 63.19 per cent stake in Ambuja and a
4.48 per cent in ACC while Ambuja owns a 50.05 per cent stake in ACC.
ACC has 17 cement manufacturing units, 9 captive power plants and 6,643 employees along with a distribution network of
56,000 dealers & retailers and a countrywide.
Ambuja Cements has a cement capacity of 31 million tonnes with 6 integrated cement manufacturing plants and 8 cement grinding units across the country.
In 2015, Holcim merged with France's Lafarge to create LafargeHolcim. In June 2016, Ambuja had bought Holcim India's 24 per cent stake in ACC, which then became an Ambuja subsidiary. —PTI