Home >Companies >News >Reliance Infrastructure shortlists 7 potential buyers for cement biz

Mumbai: Anil Ambani-led infrastructure company Reliance Infrastructure Ltd on Wednesday said it has shortlisted seven out of 15 potential buyers who submitted a preliminary expression of interest to buy its cement business.

Reliance Infrastructure will dispose of the 5.6 million tonnes per annum cement business and related assets through a formal process, the company said in a BSE filing.

“The due diligence process has commenced. Further announcements will be made at the appropriate stage," the filing said.

The company also said it has started a formal process to monetize its roads business, which has received early interest from strategic and portfolio institutional investors in India and overseas.

“The investment of 8,800 crore made by the company in its 100%-owned roads business, comprising 11 revenue-generating projects of approximately 1,000km across 7 states, will be appropriately monetized," Reliance Infrastructure said.

Reliance Infrastructure was looking to sell the cement and roads businesses in order to focus on its new defence business, said chief executive M.S. Mehta. Mehta said the sale of the two businesses will also write off the debt associated with these businesses on its books.

Mehta said the company was not looking to use the funds received from the sale to bid for new road projects. It expects to complete the sale by end of this fiscal.

“The entire proceeds will come to Reliance Infrastructure and logically, the funds will go in the pre-announced acquisition (Pipavav), toward the retirement of loans... Object is also to have a lighter balance sheet," Mehta said.

Private equity firm Blackstone Group Lp has placed a bid to acquire Reliance Cement Co. Pvt. Ltd, a wholly-owned subsidiary of Reliance Infrastructure, Mint reported last month.

A number of infrastructure companies are looking to divest their operational road assets after the government in August eased norms for monetizing their operational assets, Mint reported on 11 September, quoting three bankers.

Separately on Wednesday, Reliance Infrastructure also reported a 4.6% rise in consolidated net profit, helped by the rise in revenue of its engineering, procurement and construction, infrastructure and cement businesses.

Net profit rose to 451.13 crore in the September quarter from 431.19 crore a year ago. Net sales rose 7.9% to 4,377.86 crore from 4,057.95 crore a year earlier.

Reliance Group companies have sued HT Media Ltd, Mint’s publisher, and nine others in the Bombay high court over a 2 October 2014 front-page story that they have disputed. HT Media is contesting the case.

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