UltraTech to acquire 32.72% stake in India Cements for Rs 3,954 crore

UltraTech expansion: UltraTech Cement has announced its decision to acquire a 32.72 per cent equity stake in India Cements Limited. This acquisition, approved by UltraTech's Board of Directors, involves purchasing the equity stake from the promoters and their associates for a total of Rs 3,954 crore, at a price of Rs 390 per share, according to an exchange filing. 

UltraTech initially made a financial investment in June 2024, acquiring a 22.77 per cent equity stake in India Cements at Rs 268 per share. Subsequently, the promoter group approached UltraTech to sell their holding, leading to this latest strategic acquisition.

India Cements has a total production capacity of 14.45 million tonnes per annum (mtpa) of grey cement, with 12.95 mtpa located in the southern region, particularly in Tamil Nadu, and 1.5 mtpa in Rajasthan. This acquisition is set to improve UltraTech's presence in these key markets, particularly in the South.

The transaction is subject to regulatory approvals. Following the signing of the share purchase agreement (SPA) and the necessary regulatory green lights, UltraTech will complete the purchase. The acquisition will also trigger a mandatory open offer at Rs 390 per share, to be executed post-regulatory approvals.

Commenting on the acquisition, Kumar Mangalam Birla, Chairman of Aditya Birla Group, underlined UltraTech's strategic investments to boost India's infrastructure sector. He stated, “UltraTech Cement's investments over the years, both organic and inorganic, have been designed to propel India to become a building solutions champion globally. Every investment in a core sector like cement accelerates economic activity and drives progress.”

He further added, "The India Cements opportunity is an exciting one as it enables UltraTech to serve the Southern markets more effectively and also accelerates our path to 200+ MTPA capacity."