UltraTech Cement acquires grinding unit from India Cements; announces expansion
The unit being sold had a turnover of Rs 250.66 crore in the fiscal year ended March 31 2023 and net asset value of Rs 75.10 crore.
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NEW DELHI: Aditya Birla group company UltraTech Cement has announced the acquisition of a grinding unit from India Cements for Rs 315 crore and said it will invest an additional Rs 504 crore to expand capacity of two units.
In a stock exchange filing, UltraTech said its board has approved acquisition "of a grinding unit having installed capacity of 1.1 million tonnes per annum in addition to a captive railway siding at Parli, Maharashtra from The India Cements Limited... for a consideration of Rs 315 crores".
The company said it has entered into an Asset Purchase Agreement with the seller. "This purchase will help the Company to strengthen its presence in the rapidly growing Maharashtra markets."
Making a similar regulatory filing, The India Cements said out of the total consideration of Rs 315 crore (exclusive of taxes and levies), "Rs 307 crore will be received by the company shortly and the balance Rs 8 crore within nine months from the date of the agreement."
The unit being sold had a turnover of Rs 250.66 crore in the fiscal year ended March 31 2023 and net asset value of Rs 75.10 crore.
In a separate filing, UltraTech said its board has also approved brownfield capacity expansion -- 1.2 million tonnes per annum at Parli at a cost of Rs 166.4 crore post acquisition of the grinding unit, and 1.8 million tonnes at Dhule in Maharashtra at a cost of Rs 338 crore.
The expansions, which will be funded from internal accruals, will be completed in FY26 (April 2025 to March 2026 fiscal year).
These expansions will "cater to future growth", it added.
Post this exit, India Cements will have about 13 million tonnes per annum capacity in the southern region and 1.8 million tonnes in Rajasthan.
Banswara unit has a 1.2-million tonne clinker and a supporting 1.8-million tonne limestone mine too.
Separately, UltraTech also received approval for its proposed scheme of amalgamation of Ultratech Nathdwara and its subsidiaries (all wholly-owned subsidiaries of the company) with itself from NCLT Kolkata with effect from April 1, 2023. The Mumbai bench of the tribunal already granted the approval last month.
The rationale behind this was simplification of structure, synergy gains and full integration of the Nathdwara unit.
