Ambuja Cements acquires Penna Cement

The Adani Group company Ambuja Cements Limited have announced the acquisition of Penna Cement Industries Ltd (PCIL) for Rs. 10,422 crore, marking a major turning point in its development. The purpose of this calculated action is to strengthen Ambuja’s standing as a front-runner in the Indian cement market, especially in the south.

The diversified Adani Group’s cement and building material subsidiary, Ambuja Cements Limited, states  that a legally binding agreement has been signed to acquire Penna Cement Industries Ltd (PCIL) for an enterprise value of Rs. 10,422 crore. Ambuja plans to purchase all of PCIL’s shares from P. Pratap Reddy and his family, the company’s current promoter group. Internal accruals will provide all of the funding for the transaction.

“This historic acquisition represents a critical advancement in Ambuja Cements’ rapidly expanding growth trajectory,” states Ambuja Cements CEO and Whole-Time Director Ajay Kapur. “With the acquisition of PCIL, Ambuja is well-positioned to strengthen its position as the cement industry leader in India and increase its market share in south India. Due to its advantageous location and substantial deposits of limestone, PCIL offers the chance to boost cement production through debottlenecking and further investment. The bulk cement terminals (BCTs) hold significant importance since they provide seaborne access to the eastern and southern regions of peninsular India, in addition to an entry point into Sri Lanka. Our goal is to increase PCIL’s operational performance and make it extremely competitive in terms of cost and productivity.

 Of PCIL’s 14 MTPA cement capacity, 10 MTPA are now in operation, and the remaining 2 MTPA and 2 MTPA are being built at Krishnapatnam and Jodhpur and will be finished in six to twelve months. Railway sidings account for around 90% of the cement capacity; the remaining 10% is backed in part by captive power plants and waste heat recovery systems. Furthermore, the Jodhpur plant’s excess clinker will allow for an extra 3 MTPA of cement grinding capacity on top of the 14 MTPA capacity. To create a powerful synergy, the PCIL dealers who are currently in place will relocate to Adani Cement’s market network.

For more details visit us on:http://www.ambujacement.com

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