Adani Recently Completes The Acquisition Of Orient Cement For INR 8,100 Crore
The Adani Group has recently completed the acquisition of Orient Cement at INR 8,100 crore equity value. Orient Cement Limited has 5.6 MTPA of clinker capacity and 8.5 MTPA of cement capacity. The company has also received the statutory clearance to increase its clinker capacity by 6 MTPA and cement capacity by 8.1 MTPA.
Now this is a big acquisition for the Adani Group in the cement sector. The global conglomerate already has an enhanced presence across multiple sectors. There are multiple Adani coal mines, data centres, renewable energy parks, ports, and airports in which the global conglomerate operates.
With this acquisition, the Adani Group will be able to extend its hold over the cement manufacturing sector as well.
The Acquisition of OCL:
Ambuja Cement which is the cement and material building company of the Adani Group has recently announced signing an agreement for the acquisition of Orient Cement Limited. The acquisition will be made for an equity value of INR 8,100 crore.
As per the agreement, Ambuja Cements will acquire a 46.8% share of Orient Cement from the current promoters and public shareholders. The acquisition will be made through internal accruals. The acquisition marks another huge step taken by the Adani Group towards accelerating its growth journey in the cement sector.
It will increase the company’s cement capacity by 30 MTPA within 2 years of the acquisition of Ambuja Cements. The ongoing controversies about Adani coal mines will also subside.
How Will The Acquisition Help The Adani Group?
By acquiring OCL, Ambuja is going to reach 100 MTPA cement capacity by FY25. This acquisition will also help in increasing its presence in core markets. The company will be able to improve its Pan-India market share by 2%. OCL has a highly extensive asset base under its name. The company’s assets are equated with railway sidings and other infrastructural assets. Its operations are also well supported by renewable energy captive power plants and other facilities.
The company’s strategic location and high-quality limestone reserves will help the Adani Group in further increasing its cement capacity. The group will also be able to build itself the position of being one of the biggest names in the country’s cement sector. The Adani Group will also find it easy to increase its revenue generation.
The global conglomerate has already been generating a huge revenue from the Adani coal mines, the ports, airports, as well as the data centres. This is another step taken by the global conglomerate towards further diversifying its revenue stream.
What Does OCL’s Chairman Have To Say About The Recent Acquisition?
CK Birla, who happens to be the chairman of the CK Birla Group and Orient Cement has recently informed that the CK Birla Group is continuously reallocating its capital to enhance its focus on consumer-centric technology-driven businesses.
Orient Cement also holds an impressive track record of creating premium brands and maintaining a leading market share in the geographies in which it operates. The chairman is confident that by partnering with the Adani Group, the company will be able to drive continuous growth. It will also be able to further enhance its market presence.
Amita Birla has also mentioned that with its strong market presence and sustainability initiatives, Orient Cement will be able to accelerate its growth journey by coming under the umbrella of the Adani Group.
OCL has also extended a limestone mining lease in Chittagong for setting up integrated units with a clinker of 4 MTPA and a split grinding unit of 6 MTPA in the northern parts of India. OCL has also recently secured a concession from MPPGCL, Madhya Pradesh.
The concession was received for setting up a grinding unit within the premises of the Satpura thermal power plant. Both these complement the Adani Group’s current cement footprint.
Conclusion:
Adani with its brands Ambuja Cements and ACC are currently the second largest manufacturer of cement in India. Ambuja Cements and ACC are also among the most trusted brands for building materials.
These companies’ combined footprints include 18 integrated units, 19 grinding units, and 82 + ready-mix concrete plants. The companies also have over 1,00,000 channel partners across different areas of India.
Currently, Ambuja Cements, ACC, and Sanghi Industries have publicly listed companies on the National Stock Exchange and Bombay Stock Exchange. The recent acquisition of OCL will help the Adani Group’s in further taking its business to new heights and building itself an extraordinary position in the global landscape. The Adani Group will be able to rise above the controversies of Adani coal mines and increase its mining capacity to an extraordinary level.
