Adani Group, led by Asia’s richest Gautam Adani, received regulatory approval for an almost 311.6 billion rupees ($3.9 billion) open offer to buy the remaining shares of two Indian cement makers, Ambuja Cements and ACC.
The announcement came after Holcim Ltd.’s decision in May to sell its majority stake to the group. The deal was valued at $10.5 billion.
The group offered to buy 26 per cent of Ambuja Cements Ltd. for ₹ 385 per share and the same stake for ₹ 2,300 per share of ACC Ltd.
As per the filings, the open offer for both firms will run from August 26 to September 9.
The group got a nod from the Securities & Exchange Board of India for this open offer that requires companies to make an offer to acquire the stake of minority shareholders if their stake in a listed entity crosses 25%.
As per reports, together, Ambuja and ACC have 23 cement plants, 14 grinding stations, 80 ready-mix concrete plants and over 50,000 channel partners across India.
“Ambuja Cements and ACC are two of the strongest brands recognized across India. When augmented with our renewable power generation footprint, we gain a big headstart in the decarbonization journey that is a must for cement production,” said Adani.
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As per data compiled by Bloomberg, Adani’s open offer price for Ambuja is at a 6% discount compared to Thursday’s closing price while that for ACC is at a 1% discount.
ICICI Securities Ltd. and Deutsche Bank AG are advising Adani group on the open offer.
The transaction will make Adani Group become India’s second-largest cement producer in the competitive market.
In May, Holcim agreed to sell its 63 per cent stake in Ambuja Cements to Adani Group.
As part of the deal, Adani will inherit Ambuja’s controlling stake in another publicly traded cement producer, ACC, and will buy Holcim’s direct 4.5 per cent holding in the unit.