MUMBAI: The Adani Family, through an offshore special purpose vehicle, has entered into definitive agreements for the acquisition of Switzerland-based Holcim’s entire stake in Ambuja Cements Ltd and ACC Ltd, including an open offer consideration, for around $10.5 billion. This will make it the country’s second-largest cement producer after UltraTech Cement.
The New Indian Express in its edition dated May 11 said that Adani was likely to clinch the deal. Holcim, through its subsidiaries, holds 63.19% in Ambuja Cements and 54.53% in ACC (of which 50.05% is held through Ambuja Cements).
The deal is the largest-ever acquisition by Adani, and India’s largest ever M&A transaction in the infrastructure and materials space. “Our move into the cement business is yet another validation of our belief in our nation’s growth story,” said Gautam Adani, Chairman of the Adani Group.
“…. India also continues to be the world’s second largest cement market and yet has less than half of the global average per capita cement consumption. In statistical comparison, China’s cement consumption is over 7x that of India’s. When these factors are combined with the several adjacencies of our existing businesses that include the Adani Group’s ports and logistics business, energy business, and real estate business, we believe that we will be able to build a uniquely integrated and differentiated business model and set ourselves up for significant capacity expansion.”
Jan Jenisch, CEO of Holcim Limited said, “…I would like to thank our 10,000 Indian colleagues who have played an essential role in the development of our business over the years with their relentless dedication and expertise. I am confident that the Adani Group is the perfect home for them as well as our customers to continue to thrive.”
With India’s cement consumption at just 242 kg per capita, as compared to the global average of 525 kg per capita, there is significant potential for the growth of the cement sector in India. Ambuja Cements and ACC currently have a combined installed production capacity of around 70 mn tonnes per annum.
The two companies are among the strongest brands in India with immense depth of manufacturing and supply chain infrastructure, represented by their 23 cement plants, 14 grinding stations, 80 ready-mix concrete plants and over 50,000 channel partners across India.