Capacity post Mysore Cem merger seen at 3m tn: Heidelberg

The board of Mysore Cements has approved the merger of Indorama Cement and Heidelberg Cement with itself.

Ashish Guha, MD, Heidelberg India, expects the merger to be completed in 6-7 months. "Indorama, and Heidelberg businesses are to be transferred to Mysore Cements. There is no plans to delist Mysore Cements. Also, there will be no impact of amalgamation on pricing, and market shares and no operational changes until the court approves the merger."

Capacity post amalgamation is seen at about 3 million tonne, he said. "There are advantages on technology procurement, marketing, and consumer services front."

Excerpts from CNBC-TV18’s exclusive interview with Ashish Guha:

Q: Will Mysore Cements be de-listed?

A: Mysore Cements will continue to be listed; we don’t have any plans of de-listing. The businesses of Indorama and Hiedelberg Cement will be transferred to an amalgamated company, which is Mysore Cement and this will be subject to all approvals.

Q: What does it mean in terms of the existing capacities and your overall capacities, post this merger with Mysore Cements?

A: It will be roughly in the range of 2.8-3 million tonne.

Q: What kind of an impact is this going to have as far as your pricing cloud is concerned?

A: Nothing at all. We are in separate markets in Indorama and in Mysore. In Mysore, we are predominantly in the central, north and south. In Indorama, we are in the west. The marketshares don’t change in the respective markets. What happens is that other synergies come into play like technical, procurements, marketing, customer services, distribution and common corporate services like finance and secretarial HR.

Q: From an operational stand point, do any of the operations of the Heidelberg and Mysore Cement change at all at this point in time post this merger?

A: No, the operations don’t change. We continue our business as it is till we get an approval from the Courts to merge. So, operationally, it will continue till we get the approval from the Court. Thereafter, it will be a common platform for everyone. So, in the management team, I don’t foresee any changes taking place and it will continue with the same management team.

Q: When do you expect that in terms of timeline to happen?

A: Usually a merger with three Courts involved would take about 6-7 months. That is what we have been given to understand.