The Adani Group is now the second-largest cement producer in the nation after completing the acquisition of Ambuja Cements and ACC Limited. The longest continuously operating cement firm in India has entered the next chapter of its history.
Ambuja Cements Limited, previously known as Gujarat Ambuja Cement Limited, is a major Indian cement manufacturer. The Group sells cement and clinker to domestic as well as international markets. ACC Limited is a subsidiary of Ambuja Cements Limited, which was formerly known as The Associated Cement Companies Limited.
In 2006, the second-largest cement producer in the world, Holcim, and Ambuja Cement formed a strategic alliance. Swiss cement maker Holcim Group assumed managerial control of both Ambuja Cements Limited and ACC limited in 2004. After 17 years of business, Holcim stated that it will withdraw from the Indian market as part of a strategy to concentrate on its core markets. On April 14 2022, Holcim put its holdings in Ambuja Cements and ACC for sale.
Adani Group’s Acquisition over cement makers
On May 15, Adani Group completed the acquisition of Ambuja Cements and ACC Limited. With a combined value of USD 6.50 billion for Holcim holding an open offer consideration for Ambuja Cements and ACC, this is not only the largest purchase to date but also the largest M&A deal in India’s history in the infrastructure and materials sector.
With a vast depth of production and supply chain infrastructure, the two businesses are among the strongest in India. They have 14 integrated units, 16 grinding units, 79 ready-mix concrete factories, and more than 78,000 channel partners spread out over the country. The installed production capacity of Ambuja Cements and ACC limited is 67.5 MTPA (Million tonnes per annum). While the largest cement manufacturer in India at the moment is UltraTech Cement, a member of the Aditya Birla group, with a 120 MTPA capacity.
Gautam Adani said in a statement that they have the vision to make their cement industry into the largest and most efficient manufacturer by 2030. Synergies with the complete infrastructure platform will be advantageous for Ambuja and ACC, particularly in the areas of raw materials, renewable energy, and logistics.
Currently, Group owns a 63% stake in Ambuja Cements, they also made a 3.9 billion offer to buy the remaining shares of the cement company. Gautam Adani, has been named chairman of the board of Ambuja Cements following the purchase of Ambuja Cements Ltd. and ACC Ltd. The chairman and non-executive director positions of ACC were given to Karan Adani, the eldest son of Chairman. Currently, Karan Adani is also the CEO of Adani Ports and Special Economic Zone Limited (APSEZ).
The Board of Ambuja Cements gave its approval to a 20,000-crore preferential warrant allocation to Ambuja. Ambuja has been given the necessary tools to take advantage of the market expansion. The goal of this investment is to increase capacity in order to become the largest cement player in India by 2030.
Earlier this week, Adani Groups enter a 4 trillion market cap, with Adani Posts shares turning into multi-bagger after gaining 177% over the past two years. Gautam Adani almost became the second wealthiest on the billionaires’ list beating Jeff Bezos when his net worth reached 147 billion. The Amazon Founder, Bezos lost 2.74 billion in his stock valuation, bringing him to his third position. The world’s wealthiest billion is still led by Elon Musk with a net worth of 264 billion.
Read More: Adani beats JSW in Cement Manufacturing.
