Adani Cementation Board Approves Merger with Ambuja Cement

Adani Cementation Limited, a subsidiary of Adani Enterprises announced its merger with Ambuja Cements. This announcement came after both boards approved the merger, which will allow Adani Cementation to become a wholly-owned subsidiary of Ambuja Cements. 

Benefits of the merger:

The proposed merger scheme will result in the consolidation of the cement capacity within the Adani Group. This will help in providing synergized benefits for all stakeholders. Ambuja Cement, a leading cement manufacturing company in the country, will be able to enhance its manufacturing capacity to carry out its manufacturing operation more effectively and seamlessly. This would lead to enhanced value addition for both the aforesaid companies and consequently, the value for shareholders will increase. By absorbing the business of Adani Cementation, Ambuja Cements will also get access to strategic locations like Dahej Port and Amba River in Raigad which will enable the company to source clinker cement by Sea as well as Rail to serve the high-growth market of South Gujarat and Mumbai. Ambuja Cemets currently has a consolidated capacity of 77 MTPA. With the vision of Adani Enterprises to expand its cement capacity to 140 MTPA by 2028, its recent acquisitions and mergers would be steps in achieving the milestone.

Shareholding Pattern:

Currently, Adani Enterprises owns a 100% stake in Adani Cementation, which in turn holds a 100% stake in Adani Cement Industries. Now, Adani Enterprises will be swapping shares of Adani Cementation with shares of Ambuja Cements. The swap ratio will be 174 shares of Ambuja Cements for 1 share of Adani Cementation resulting in the allotment of 87,00,000 equity shares of Ambuja Cements to Adani Enterprises.

Conclusion: The merger of Ambuja Cement and Adani Cementation Limited proves to be a step in enhancing operational efficiency and strengthening Ambuja Cement’s total footprint.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.