UltraTech Cement to acquire two cement plants from Jaiprakash

UltraTech Cement Ltd, an Aditya Birla Group company, has decided to acquire cement business of Jaiprakash Associates Limited (JAL) in Madhya Pradesh for an enterprise value of Rs 5,400 crore.

The acquisition includes the integrated cement plant with clinker capacity of 2.1 mtpa and cement grinding capacity of 2.6 mtpa at Bela. The other cement plant at Sidhi has capacity of 3.1 mtpa and cement grinding capacity of 2.3 mtpa. Both units have a total of 180 MW power generation capacity.

“The Board has approved the MoU setting out the broad terms and conditions of the proposed acquisition. The Enterprise Value of this acquisition has been agreed at Rs. 5,400 crore,” Ultratech said issuing a statement.

The acquisition would create significant synergies and the units would add 4.9 mtpa capacity immediately, it said, adding the surplus clinker would enable Ultratech to augment its cement capacity by a further 1.8-2.5 mtpa.

With this acquisition, the company’s cement capacity in India will increase from around 60 mtpa to around 65 mtpa and with projects underway. “The capacity will stand raised to around 71 mtpa  by 2016,” it said.

19