Construction Industry News
Dalmia Bharat said its cement subsidiary will acquire Jaiprakash Associates' cement and power plants for Rs 56.66 billion, ending months of speculation over potential suitors for the assets.
The combined assets have a cement production capacity of 9.4 million tonnes, a clinker capacity of 6.7 million tonnes and thermal power plants of 280 MW and are located in Madhya Pradesh, Uttar Pradesh and Chhattisgarh.
The new plants will bring Dalmia Cement's cement production capacity to 46.3 MTPA from the current 35.9 MTPA, according to the website. This will move the cement producer closer to its goal of reaching a capacity of 75 MTPA in FY27 and over 110 MTPA in FY31.
It will also bring India's fourth-largest cement producer close to third-placed Shree Cement in terms of production capacity. UltraTech Cement and the Adani Group – who recently acquired Ambuja Cements and ACC – are the leading cement producers in India.
Debt-laden Jaiprakash Associates had said in a legal filing earlier this year that it would divest its cement assets. Previously, media reports claimed that the Adani Group was the frontrunner in acquiring these assets.
The transaction is yet another major consolidation in India's highly fragmented cement sector. The acquisition of ACC and Ambuja Cements by the Adani Group earlier this year and Gautam Adani's subsequent announcement of aggressive expansion plans spurred the cement industry into action. Established leading players have followed suit and announced similarly aggressive expansion plans.
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