Lafarge eyes Rs. 1,550cr cement buys

Mumbai : European cement manufacturing giant, Lafarge has evinced keen interest to buy Meghalaya based Star Cement and also another unit owned by the Chennai-based Ramco Group in West Bengal involving a combined investment of Rs. 1,550cr. While the Bengal firm is estimated to cost the company about Rs. 350cr and Meghalaya unit may cost nearly Rs. 1,200cr. YES Bank, on the other hand, is believed to be advising the European player and Star Cement has engaged the services of Morgan Stanley to help them explore strategic options including buyer for the firm.

According to available reports, Star Cement is a popular brand of the Cement Manufacturing Company Limited (CMCL), which also sells plywood under the brand name of Centuryply. Sources claimed that the cement company has the largest cement share in the north east with a capacity of 1.2 million tons per annum and it is also adding extra capacity of 3.2 million tons per annum in Assam and Bihar plants. Similarly the Bengal unit is located at Kolaghat in Purba Medinapur district of the state and was set up to feed cement surpluses from the southern areas to eastern region. The Madras Cements has capacity of over 10 million tons per annum after doubling the production facility at its Ariyalur plant in Tamil Nadu and the company has also ramped up its cement making capacities in southern states. It moves clinker from its existing cement plant at Jayanthipuram in Andhra Pradesh in bulk and grinds it with gypsum and bags the same to sell in eastern markets.