Adani’s cement business will face a challenge, the way is cleared for UltraTech Cement to buy stake in India Cement
The Competition Commission of India (CCI) has approved UltraTech Cement’s over Rs 7,000 crore deal to acquire a majority stake in India Cements. The approval came less than two weeks after the regulator issued a show-cause notice to UltraTech seeking clarifications on the proposed deal. The deal will help UltraTech Cement strengthen its market lead amid growing competition from the Adani Group. CCI said in a statement, “The proposed transaction involves the acquisition of 32.72 per cent of the paid-up equity share capital of India Cements Limited by UltraTech Cement Limited.
Promoter stake will be acquired
This acquisition will be done from the promoters and members of the promoter group of India Cements and Shri Sharda Logistics Private Limited.” Apart from this, the fair trade regulator has also approved UltraTech Cement to acquire up to 26 per cent of the paid-up equity share capital of India Cements through an open offer. The competition regulator said, “The Competition Commission of India has approved the acquisition of India Cements Limited by UltraTech Cement Limited.”
An open offer of Rs 3,142.35 crore will also come
If the fair trade regulator feels that a merger or acquisition is likely to have an adverse effect on market competition in India, it issues a show cause notice under the CCI Act and asks them to respond within 15 days. UltraTech Cement had announced the acquisition of 32.72 per cent stake in India Cements Limited from the promoters and their associates in a deal worth Rs 3,954 crore on July 28. This will help the company to increase its presence in the highly competitive and fast-growing South Indian cement market. Apart from this, UltraTech has also announced an open offer of Rs 3,142.35 crore to acquire 26 per cent shares of ICL from shareholders.
