Ambuja Cements’ acquisition of Penna Cement for ₹10,422 crore raises Adani’s cement market share by 8%

  • Adani Group firm Ambuja Cements acquired 100 per cent shares of Penna Cement for 10,422 crore

Nikita Prasad
First Published13 Jun 2024, 06:24 PM IST
(File) Trucks enter the Ambuja Cement factory in Mumbai; Photographer: Santosh Verma/Bloomberg News
(File) Trucks enter the Ambuja Cement factory in Mumbai; Photographer: Santosh Verma/Bloomberg News

Ambuja Cements, an Adani group firm on Thursday, June 13, announced the acquisition of Penna Cement Industries Ltd (PCIL) at an enterprise value of 10,422 crore. A binding agreement for the acquisition has been signed, which will add 14 MTPA capacity to Adani group, taking the total tally to 89 MTPA (million tonnes per annum).

The acquisition will improve Adani group's share in the cement market pan-India by 2 per cent and 8 per cent in south India, according to a regulatory filing by Ambuja Cements to the stock exchanges. 

Also Read: Adani family invests 8,339 cr more in Ambuja Cements; stake rises to 70.3%

Ambuja will acquire 100 per cent shares of PCIL from its existing promoter group P Pratap Reddy and family. PCIL has 14 MTPA capacity in Andhra Pradesh, Telangana, and Rajasthan (under-construction).  The acquisition will be fully funded through internal accruals.

“By acquiring PCIL, Ambuja is poised to expand its market presence in south India and reinforce its position as a pan-India leader in the cement industry. PCIL’s strategic location and sufficient limestone reserves provide an opportunity to increase cement capacity through debottlenecking and additional investment,'' said Ajay Kapur, CEO & Whole Time Director of Ambuja Cement.

‘’Importantly, the bulk cement terminals (BCTs) will prove to be a gamechanger by giving access to the eastern and southern parts of peninsular India, apart from an entry to Sri Lanka, through the sea route. Our aim is to make PCIL highly competitive on cost and productivity and improve its operating performance,'' added Kapur.

Besides, it also has surplus clinker at Jodhpur plant which will support additional 3 MTPA cement grinding capacity. The deal will also strengthen Adani group's sea transportation logistics with five bulk cement terminals at Kolkata, Gopalpur, Karaikal, Kochi and Colombo to serve peninsular India.

Earlier this year, the Adani family, led by billionaire businessman Gautam Adani, infused 8,339 crore into the group's cement subsidiary Ambuja Cements Ltd. by fully subscribing to the latter's warrants programme.

On Thursday, shares of Ambuja Cements settled 0.63 per cent lower at 664.30 apiece after hitting a new 52-week high mark of 680.20 on the BSE.

 

 

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.MoreLess

News in Numbers

Numbers that help you understand news better
₹295 Cr

$23 B

$65 M

3.36%

$65.47 B

$2.5 M

₹80 Cr

1.4%

₹773 Cr

₹2,705 Cr

₹1 Cr

₹14,370 Cr

₹5.74 T

First Published:13 Jun 2024, 06:24 PM IST
HomeMarketsStock MarketsAmbuja Cements’ acquisition of Penna Cement for ₹10,422 crore raises Adani’s cement market share by 8%

Most Active Stocks

Tata Steel

166.80
03:59 PM | 15 JUL 2024
-1.9 (-1.13%)

NTPC

385.65
03:58 PM | 15 JUL 2024
8.4 (2.23%)

Bank Of Baroda

258.60
03:53 PM | 15 JUL 2024
7.85 (3.13%)

Bharat Electronics

331.25
03:55 PM | 15 JUL 2024
-2.05 (-0.62%)
More Active Stocks

Market Snapshot

  • Top Gainers
  • Top Losers
  • 52 Week High

Indian Overseas Bank

68.33
03:41 PM | 15 JUL 2024
4.68 (7.35%)

M M T C

94.92
03:40 PM | 15 JUL 2024
6.31 (7.12%)

NLC India

297.75
03:57 PM | 15 JUL 2024
18.6 (6.66%)

IDBI Bank

91.54
03:58 PM | 15 JUL 2024
5.6 (6.52%)
More from Top Gainers

Recommended For You

    More Recommendations

    Gold Prices

    • 24K
    • 22K
    Bangalore
    74,771.000.00
    Chennai
    73,827.000.00
    Delhi
    73,972.000.00
    Kolkata
    74,045.000.00

    Fuel Price

    • Petrol
    • Diesel
    Bangalore
    102.86/L0.00
    Chennai
    100.75/L0.00
    Kolkata
    104.95/L0.00
    New Delhi
    94.72/L0.00
    OPEN IN APP
    HomeMarketsPremiumInstant LoanMint Shorts