Mumbai: Aditya Birla Group-controlled UltraTech Cement Ltd on Wednesday said India’s anti-trust regulator has approved its deal to buy Jaypee Group’s cement business.

On 4 July, Mint reported that UltraTech Cement amended an agreement with Jaiprakash Associates Ltd, agreeing to buy its 21.1 million tonne cement assets for 16,189 crore, 289 crore higher than the enterprise value agreed upon earlier.

“... the Competition Commission of India (CCI) has by its letter dated 8 August 2016 informed the company that it has approved the proposed combination under sub-section (1) of section 31 of the Competition Act, 2012. Copy of the CCI order is awaited," the company said in a notice to BSE.

With the completion of this deal, UltraTech’s cement capacity will increase to 91.1 million tonne per annum (mtpa).

On Wednesday, shares of UltraTech Cement closed at 3,728.50 apiece on BSE, down 1.93% from previous close, while India’s benchmark Sensex Index fell 1.1% to close at 27,774.88 points. Shares of Jaiprakash Associate fell 5.4% to 11.13 apiece.

The deal involves cement manufacturing capacity of 17.20 mtpa spread over the states of Uttar Pradesh, Madhya Pradesh, Himachal Pradesh, Uttarakhand and Andhra Pradesh, besides a grinding unit of 4 mtpa capacity, which is currently being built in Uttar Pradesh. UltraTech Cement is to pay an additional amount of 470 crore for completion of the grinding unit.

The consummation of the transaction is expected to take nine to 12 months.

The sale is crucial for Jaiprakash Associates, which is seeking to reduce debt by raising money through asset sales. As of 31 March, Jaiprakash Associates had a consolidated debt of 58,250 crore.

In February, UltraTech Cement called off its deal with Jaiprakash Associates for the purchase of two Madhya Pradesh cement assets for 5,400 crore due to lack of required regulatory approvals for the transfer of related mining assets.

The two Madhya Pradesh cement assets were subsequently folded into the larger deal for the sale of Jaiprakash Associates’ entire cement division.

Simultaneously, the government has clarified that related mining assets can be transferred, facilitating several deals in the cement business.