UltraTech Cement to Become Majority Shareholder in India Cements
UltraTech Cement’s Board of Directors has approved the purchase of a 32.72% equity stake in India Cements, increasing its ownership to 55.49%. This transaction, subject to regulatory approvals, will cost Rs 3,954 crores.
Kumar Mangalam Birla, Chairman of Aditya Birla Group, highlighted the strategic importance of this acquisition for expanding UltraTech’s presence in Southern India. The deal is expected to be completed within six months.
Details of the Transaction
UltraTech Cement had previously acquired a 22.77% equity stake in India Cements at Rs 268 per share in June 2024. The latest transaction will be at Rs 390 per share. The promoter group of India Cements approached UltraTech to sell their holding, which led to this acquisition.
Regulatory Approvals
The transaction is subject to the approval of the Competition Commission of India and other regulatory bodies. An open offer at Rs 390 per share will follow the acquisition, expected to be completed within six months.
Strategic Importance
India Cements has a total capacity of 14.45 million tonnes per annum of grey cement, with significant operations in Tamil Nadu and Rajasthan. This acquisition will help UltraTech Cement serve the Southern markets more effectively and accelerate its path to a 200+ MTPA capacity.
UltraTech Cement Limited is the cement flagship company of the Aditya Birla Group.
Doubts Revealed
UltraTech Cement -: UltraTech Cement is a big company in India that makes cement, which is used to build houses and buildings.
Majority Shareholder -: A majority shareholder is someone or a company that owns more than half of another company’s shares, giving them control over the company.
India Cements -: India Cements is another company in India that also makes cement.
Equity Stake -: An equity stake means owning a part of a company by having its shares.
Regulatory Approvals -: Regulatory approvals are permissions that companies need to get from the government to make sure their actions are legal and fair.
Rs 3,954 crores -: Rs 3,954 crores is a large amount of money in Indian currency, where 1 crore equals 10 million rupees.
Kumar Mangalam Birla -: Kumar Mangalam Birla is a famous businessman in India and the Chairman of the Aditya Birla Group, which owns UltraTech Cement.
Aditya Birla Group -: Aditya Birla Group is a big company in India that owns many businesses, including UltraTech Cement.
Strategic Importance -: Strategic importance means something that is very important for a company’s long-term plans and success.
Southern India -: Southern India is the southern part of India, which includes states like Tamil Nadu, Karnataka, and Kerala.