Dalmia Cement (Bharat), a wholly owned subsidiary of Dalmia Bharat, announced today an agreement to acquire clinker, cement, and power plants with a total cement capacity of 9.4 million tonnes from Jaiprakash Associates and its associate for a total enterprise value of 5,666 crore. This includes clinker capacity of 6.7MnT and thermal power plants with a combined capacity of 280 MW.
These Jaypee Group assets are located in Madhya Pradesh, Uttar Pradesh, and Chhattisgarh, and the purchase will allow Dalmia Bharat to expand its presence in the central region.
With this agreement, Jaiprakash Associates, the flagship company of the Jaypee group, has decided to exit the cement business entirely. To reduce debt, Jaiprakash Associates previously divested more than 20 MTPA cement capacity to UltraTech Cement between 2014 and 2017.
On the BSE, Jaiprakash Associates shares rose 10 per cent to Rs 11.74 per share, while Dalmia Bharat rose 3.3 per cent to Rs 1,905.70 per share.
Dalmia Bharat aims to become a pan-India cement company with 75 MnT capacity by FY27 and 110130 MnT capacity by FY31. The transaction is subject to due diligence, approvals from lenders/JV partner of Jaiprakash Associates Limited, and regulatory authorities, according to Dalmia Bharat.
In October, Jaiprakash Associates and Jaiprakash Power Ventures of the Jaypee Group announced plans to divest their cement business as well as some non-core assets in order to reduce debt.
Earlier this year, the Adani group announced the completion of its acquisition of Ambuja Cements and ACC for a total consideration of $6.5 billion (approximately 53,800 crore), which included the purchase of Swiss major Holcim’s stake in the two companies as well as subsequent open offers to minority shareholders.
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