Ambuja Cements board approves Adani Cementation's merger with itself

Adani Enterprises will receive 8.7 million shares of Ambuja Cements as part of the merger.

Ambuja Cements, owned by the Adani group, announced that its board has approved the merger of Adani Cementation, currently a subsidiary of Adani Enterprises. Following regulatory and shareholder approvals, Adani Cementation will become a wholly-owned subsidiary through a share swapping process, as reported by Business Standards.

Adani Enterprises will receive 8.7 million shares of Ambuja Cements as part of the merger. The consolidation of cement capacities within the Adani Group aims to improve operational efficiency and bolster Ambuja Cements' coastal presence. The merger scheme specifies a swap ratio of 174 shares of Ambuja Cements for every 1 share of Adani Cementation (ACL).

The merger will also strategically position Ambuja Cements to leverage sea and rail logistics for serving the high-growth markets of South Gujarat (Dahej) and Mumbai (Raigad), providing a competitive advantage. The Adani group, led by billionaire Gautam Adani, currently boasts an installed capacity of 79 million metric tonnes per annum (MTPA). The ambitious growth plan targets increasing this capacity to 140 MTPA by 2028.

Earlier this month, the group announced the acquisition of Hyderabad-based Penna Cement for Rs 10,422 crore, which will add 14 MTPA to its capacity, bringing it to 93 MTPA. Last December, it completed the acquisition of Saurastra-based Sanghi Industries for Rs 5,185 crore.

The Adani group entered the cement sector in September 2022 by acquiring controlling stakes in Ambuja Cement from Holcim for USD 6.4 billion (approximately Rs 51,000 crore). Ambuja Cements holds a 51% stake in ACC. Additionally, it launched a Rs 31,000 crore open offer to acquire an additional 26% stake from public shareholders.