Dalmia Cement (Bharat) Ltd (DCBL), wholly owned subsidiary of Dalmia Bharat Limited, today announced an agreement to acquire clinker, cement and power Plants from Jaiprakash Associates Ltd and its associate having total cement capacity of 9.4 million tonnes at an enterprise value of ₹5,666 crore. This includes clinker capacity of 6.7MnT and thermal power plants of 280 MW capacity.
These Jaypee Group assets are situated in Madhya Pradesh, Uttar Pradesh and Chhattisgarh and the acquisition will enable Dalmia Bharat to expand its footprint into the central region.
With this agreement, Jaypee group flagship company Jaiprakash Associates has decided to divest from cement business completely. In the past, to reduce debt, Jaiprakash Associates had divested more than 20 MTPA cement capacity in favour of UltraTech Cement Limited during 2014 and 2017.
Shares of Jaiprakash Associates rose 10% to end at Rs 11.74 apiece on BSE, whereas Dalmia Bharat was up 3.3% at Rs 1,905.70 per share.
Dalmia Bharat aims to emerge as a pan-India cement company with a capacity of 75 MnT by FY27 and 110â€130 MnT by FY31. The transaction is subject to dueâ€diligence, requisite approvals from lenders/JV partner of Jaiprakash Associates Limited and regulatory authorities, Dalmia Bharat said in a statement.
In October, Jaypee Group companies Jaiprakash Associates and Jaiprakash Power Ventures had announced plans to divest their cement business as well as some non-core assets to reduce debt.
Manoj Gaur, Executive Chairman Jaiprakash Associates Limited, in a statement today said: “Jaiprakash Associates ltd. (JAL), the flagship company has been taking steps to reduce its debt and repay to lenders and meet its commitments on proactive basis. In this regard, JAL had divested more than 20 MTPA cement capacity in favour of MIs. UltraTech Cement Limited during 2014 and 2017, while selling its controlling stake of more than 2 MTPA cement capacity to Dalmia Group in 2015."
"In order to repay the loans of lenders and concentrate in its other core areas of working, JAL has decided to divest from cement business completely. With the sale of cement capacity of 9.4 MTPA in favour of Dalmia Cement (Bharat) ltd. (DCBL), we hope and pray having demonstrated its creditable working, JAL will further 'cement' its credentials of being a trustworthy organization in infrastructure segment of the country in times to come," he added.
Earlier this year, the Adani group announced the completion of the acquisition of Ambuja Cements and ACC for a total consideration of $6.5 billion (about ₹53,800 crore), which includes the buyout of Swiss major Holcim's stake in the two firms and subsequent open offers to minority shareholders.
