DBT Bureau
Bengaluru, 27 June 2024
UltraTech Cement on Thursday said that the company’s board has given approval for acquisition of a 23% equity stake in India Cements.
In an exchange filing, the company said it would buy 7.06 crore shares of India Cements at Rs 267 per share. This will translate into a deal value worth around Rs 1,885 crore.
“The Board of Directors of the company at its meeting held today approved making a financial investment to purchase up to 7.06 crores equity shares of The India Cements Ltd
at a price of up to Rs 267/- per share. This non-controlling financial investment constitutes around 23% of the equity share capital of ICL,” the company said in the exchange filing.
Meanwhile, around 20% of equity stake in India Cements was sold in the block deal window on Thursday. A final confirmation to this bulk deal is likely to be at the end of today’s trading session.
In the filing, the Aditya Birla Group company mentioned that the acquisition is likely to be completed with in one month. It also said that the acquisition is being done in cash.
Currently, the promoter group holds 28.42% stake in India Cements. Ace investor, Radhakishan Damani and associates hold around 20.78% stake in the cement firm.
Following the news, India Cements share price surged in the morning trade and is currently trading 10.92% higher at Rs 290.72 (10 AM) on NSE. The share price of UltraTech Cement jumped 4.38% to trade at Rs 11,630.
Indian cement sector has seen a consolidation phase with large players acquiring smaller ones in recent years. Adani Group had acquired cement assets of ACC, Ambuja and Sanghi Industries. Similarly, Ultratech Cement has acquired the cement company of Kesoram Industries. All in all, there have been 13 mergers and acquisitions during the last 7 years in the Indian cement industry.
