Ambuja Cements, the cement and building materials company of the Adani Group, has announced the merger of Sanghi Industries (SIL) and Penna Cement Industries with itself. Ambuja will issue 12 equity shares for every 100 equity shares of SIL as recommended by the valuers and accepted by the Ambuja Board.
These transactions will be effected with requisite approvals from related stakeholders and authorities, anticipated to be completed within 9 to 12 months’ time.
Ajay Kapur, CEO – Cement Business, Adani Group, said, “Enhanced working capital management and internal funds will support the growth of our business operations. Unified cash flow management will pool resources for faster expansion and cost savings in administration and governance, thereby simplifying compliance requirements.”
After a series of acquisitions, Ambuja Cements plans to increase its total cement production capacity to over 100 MTPA by the end of FY25. At present, it has a capacity of 89 MTPA.
Adani Group, which acquired Holcim’s assets in India (Ambuja and ACC) in September 2022, is the second-largest cement manufacturer in India. It trails behind billionaire Kumar Mangalam Birla’s Ultratech Ltd.
In June 2024, Ambuja Cements acquired Penna Cement from the P Pratap Reddy family for Rs 10,442 crore. Last year in December, Ambuja completed the acquisition of SIL at an enterprise value of Rs 5,185 crore. With the acquisition, Ambuja held a controlling stake of 54.51% in SIL.
SIL has a clinker capacity of 6.6 MTPA, a cement capacity of 6.1 MTPA, and limestone reserves of 1 billion tonnes. SIL’s Sanghipuram plant is India’s largest single-location cement and clinker unit by capacity, with a captive jetty and captive power plant.
Penna has four integrated plants in Andhra Pradesh and Telangana, along with a grinding unit in Maharashtra. It has an operational capacity of 10 MTPA. Additionally, two plants, with a capacity of 2 MTPA each, are under construction in Krishnapatnam and Jodhpur, expected to be completed within the next 8 to 12 months.
It also has five bulk cement terminals at Kolkata, Gopalpur, Karaikal, Kochi, and Colombo (Sri Lanka).