Adani Group’s concrete plan: $3 billion buyouts in cement space
Penna Cement, Gujarat-headquartered Saurashtra Cement and the cement business of Jaiprakash Associates as well as ABG Shipyard-owned Vadraj Cement, according to people familiar with the matter.
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It is keeping aside a war chest of $3 billion for these acquisitions, these people said. The group is aggressively pursuing an inorganic strategy to boost capacity and emerge as the largest cement manufacturer within the next three to four years, overtaking the Aditya Birla Group’s UltraTech. India’s cement giants are betting on a surge in demand as the Centre pushes ahead with its infrastructure development plan, driven by record capital expenditure. Penna Cement could be valued at around Rs 9,000 crore, the people said. The valuation could go up depending on the progress of capacity expansion from 10 MTPA (million tonnes per annum) to 15.5 MTPA.
Saurashtra Cement has a market capitalisation of Rs 1,487 crore. Dalmia Bharat had in April 2022 signed a definitive agreement with Jaiprakash Associates to acquire the latter’s cement, clinker and power plants for Rs 5,666 crore.
The deal got stuck because of shareholder disputes. ET has learnt that the group is looking to offer $85-120 enterprise value (EV) per ton for these mid-sized cement businesses and is open to paying a premium if the target company has
