Adani to foray into the cement sector with acquisition of Holcim’s India business

The Adani Group on Sunday has bagged a deal to acquire a controlling stake in Swiss cement major, Holcim Ltd's businesses in India for USD 10.5 billion. The deal marks the ports-to-energy conglomerate's entry into the cement sector.

The Group has in the last couple of years diversified beyond the core business of operating ports, power plants, and coal mines into airports, data centres, and clean energy. It had last year set up two cement subsidiaries - Adani Cementation Ltd and Adani Cement Ltd. Adani Cementation is planning to set up two cement units at Dahej in Gujarat and Raigarh in Maharashtra.

The deal will make billionaire Gautam Adani's conglomerate the second-largest player in the domestic cement sector by acquiring the joint control of Holcim's two Indian step-down firms ACC Ltd and Ambuja Cement, with a capacity of about 70 Metric Tonnes Per Annum (MTPA), the statement added.

The deal, which will take place through an offshore special purpose vehicle, values the Holcim stake and open offer consideration for Ambuja Cements and ACC at about $10.5 billion. This deal will become the largest ever acquisition by Adani, and India’s largest ever M&A transaction in the infrastructure and materials space, according to a company statement.

Holcim, through its subsidiaries, holds 63.19 percent in Ambuja Cements and 54.53 percent in ACC (of which 50.05 percent is held through Ambuja Cements).