Construction Industry News
The Amravati bank of the National Company Law Tribunal (NCLT) has approved a bid by Sagar Cements to acquire Andhra Cements for Rs 9.22 billion; the Jaypee Group cement maker, which is now facing insolvency proceedings, would remain listed on the stock exchanges.
On February 16, Sagar Cements' board of directors approved a plan to approximately quadruple Andhra Cements' capacity to 3 million tons per year, at a cost of Rs 4.68 billion.
Sagar Cements plans to raise RS 6.22 billion in loans and Rs 3.22 billion in equity from the proposed acquisition cost of Rs 9.22 billion.
The acquisition gives Sagar Cements a 95 percent stake in Andhra Cements, while the public owns the remaining 5%.
Sagar Cements clarified that Andhra Cements will remain publicly traded and stated that it will reduce its stake to 90% within 12 months and to 75% within 36 months of the date of NCLT approval.
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