CK Birla Group to sell Orient Cement to Adani Group at ₹8100 crore equity value

Ambuja Cement
| Photo Credit: Reuters

The CK Birla Group on Tuesday (October 22, 2024) signed definitive agreements with Ambuja Cements, part of the Adani Group, to transfer its entire shareholding in Orient Cement Limited, valuing the company at an equity value of ₹8100 crore (USD 964 million) at an equity value of INR 395.4 per share.

Orient Cement share price was down 1.32% on the BSE

CK Birla, Chairman of Orient Cement and the CK Birla Group, said, “The CK Birla Group is continuously reallocating capital to sharpen its focus on consumer centric, technology driven and service based businesses. I take pride in Orient Cement’s impressive track record of building premium brands and maintaining a leading market share in the geographies it operates in. We are confident that the Adani Group, with its strong focus on cement and infrastructure, is the ideal new owner to drive continued growth at Orient Cement for our people and stakeholders”.

Amita Birla, Co-Chairman, CK Birla Group, added, “Orient Cement has a strong market presence, with sustainability initiatives, particularly in renewable energy, being a significant part of its DNA. I am convinced that Ambuja Cements is the right home for all our colleagues at Orient Cement, as well as our customers.”

“This timed acquisition marks another significant step forward in Ambuja Cements’ accelerated growth journey, increasing cement capacity by 30 MTPA within two years of the acquisition,” said Karan Adani, Whole time Director of Ambuja Cements.

“By acquiring Orient Cement, Ambuja is poised to reach 100n MTPA cement capacity in FY25. The acquisition will help to expand Adani Cement’s presence in core markets and improve its pan India market share by 2%,” he added

The transaction is subject to regulatory approvals, including approval by Competition Commission of India and mandatory open offer under the relevant SEBI regulations.

There is intense competition between the Aditya Birla Group and Adani Group to pick up running cement companies of third parties to remain number one or be number one. Currently, UltraTech Cement of AB Group is the biggest.

Chandrakant Birla (CK Birla) is a member of the extended Birla family. He used to lead Hindustan Motors, the company that used to manufacture Ambassador cars. The company was started by his grandfather.