Adani Group’s Ambuja Cements acquires Penna Cement for Rs 10,422 crore

Adani Group-owned Ambuja Cements has actually revealed the acquisition of Penna Cement Industries Ltd (PCIL) for Rs 10,422 crore.

The offer was signed on Thursday and consists of the purchase of 100% shares of PCIL from its present owners, P Pratap Reddy and household, according to a business submitting to the exchanges.

“Ambuja Cement, the cement and structure product business of Adani Cement and part of the varied Adani Group, today revealed the finalizing of a binding arrangement for the acquisition of Penna Cement Industries Ltd (PCIL) at a business worth of Rs. 10,422 crore. Ambuja will obtain 100% shares of PCIL from its existing promoter group, Mr. P. Pratap Reddy and household. The acquisition will be totally moneyed through internal accruals,” stated the exchange filing.

Ambuja Cements will money this acquisition totally through internal accruals, based on the filing.

Ajay Kapur, CEO and Whole Time Director of Ambuja Cements, called this offer a substantial turning point in the business’s development.

By obtaining PCIL, Ambuja is poised to broaden its market existence in south India and enhance its position as a pan-India leader in the cement market,” stated Kapur.

PCIL has an overall cement production capability of 14 million tonnes per year (MTPA), with 10 MTPA presently functional. The staying 4 MTPA capability is under building and construction at Krishnapatnam (2 MTPA) and Jodhpur (2 MTPA), anticipated to be finished in the next 6 to 12 months.

Around 90% of PCIL’s cement capability is geared up with train sidings, which assists in effective transport.

Furthermore, some centers have captive power plants and waste heat healing systems, boosting energy performance. There is likewise surplus clinker at the Jodhpur plant, which can support an extra 3 MTPA cement grinding capability, increasing the overall prospective capability beyond 14 MTPA.

The existing network of PCIL dealerships will incorporate into Adani Cement’ s market network, producing strong synergies. The acquisition is anticipated to be finished in the next 3–– 4 months.

The combined turnover of PCIL for the previous 3 fiscal years is as followsRs 1,241 crore in FY2023-24, Rs 2,002 crore in FY2022-23, and Rs 3,204 crore in FY2021-22.

This acquisition is anticipated to improve Adani Cement’ s market share by 2% throughout India and by 8% in South India.

The statement of this offer followed market hours. Ambuja Cements’ stock closed at Rs 663.80 on the NSE, seeing a decrease of Rs 4.90 or 0.73%.