Ambuja Cements Ltd. said it had signed a binding agreement for acquisition of 100% shares of Penna Cement Industries Ltd. (PCIL) from its existing promoter group – namely P. Pratap Reddy and family – at an enterprise value of ₹10,422 crore. The acquisition will be fully funded through internal accruals, the Adani Group company said in a filing with stock exchanges. “This landmark acquisition is a significant step forward in Ambuja Cements’ accelerating growth journey,” Ajay Kapur, CEO & Whole Time Director of Ambuja Cements said in a statement.
“By acquiring PCIL, Ambuja is poised to expand its market presence in south India and reinforce its position as a pan-India leader in the cement industry,” he added.
“PCIL’s strategic location and sufficient limestone reserves provide an opportunity to increase cement capacity through debottlenecking and additional investment. Importantly, the bulk cement terminals (BCTs) will prove to be a gamechanger by giving access to the eastern and southern parts of peninsular India, apart from an entry to Sri Lanka, through the sea route,” he further said.
PCIL has 14 mtpa cement capacity, of which 10 mtpa is operational, while the remaining is under construction at Krishnapatnam (2 mtpa) and Jodhpur (2 mtpa), and will be completed within 6 to 12 months. The existing dealers of PCIL will move to Adani Cement’s market network, the company said.
