Kumar Mangalam Birla’s UltraTech Cement is set to acquire the building materials business of Kesoram Industries (KI), a company owned by his aunt Manjushree Khaitan, for an enterprise value of Rs 7,600 crore. This move strengthens the billionaire’s position in the country amid significant expansion initiatives by Gautam Adani for Ambuja Cements. The acquisition of Kesoram Cement provides Birla with a manufacturing facility in Telangana and expedites UltraTech’s efforts to achieve a capacity of 200 million tonnes in the country.
MUMBAI/KOLKATA: UltraTech Cement, led by Kumar Mangalam Birla, is set to acquire the building materials business of Kesoram Industries (KI), a company owned by his aunt Manjushree Khaitan, for an enterprise value of Rs 7,600 crore. This move solidifies the billionaire’s presence in the country amidst significant expansion initiatives by Gautam Adani for Ambuja Cements. The acquisition of Kesoram Cement provides Birla with a manufacturing facility in Telangana and expedites UltraTech’s goal of reaching a capacity of 200 million tonnes in the country.
ALSO READ : – BSE market capitalization surges with Adani stocks rally, surpasses $4 trillion.
UltraTech Cement, owned by Kumar Mangalam Birla, is set to acquire the building materials business of Kesoram Industries (KI), a company owned by his aunt Manjushree Khaitan. The enterprise value of the deal is Rs 7,600 crore, enhancing Birla’s position in the country amid significant expansion plans by Gautam Adani for Ambuja Cements. The transaction involves KI separating its cement business and then merging it with UltraTech. For the demerger and amalgamation, Birla will issue one share of UltraTech to KI’s shareholders for every 52 shares they hold. This will slightly reduce Birla’s stake in UltraTech from the current 59.96% to 59.16%. The Rs 7,600-crore enterprise value comprises an equity value of Rs 5,379 crore and debt of Rs 2,221 crore, with an offer price of Rs 173 per share – a 34% premium to KI’s last close of Rs 140. KI’s cement business, contributing 99.5% to its turnover, includes two manufacturing facilities in Karnataka and Telangana, along with a packing plant in Maharashtra, generating a turnover of Rs 3,518 crore in FY23. This acquisition will boost UltraTech’s capacity from 138 million tonnes to 149 million tonnes, making it the world’s third-largest cement producer outside China. The sale of the cement business will enable KI to focus on its rayon, transparent paper, and chemicals businesses.
“Exciting news! Nyreadtime is now on twitter Channels 🚀 Subscribe today by clicking the link and stay updated with the latest news insights!” Click here!