Ambuja Cements, India’s second largest cement manufacturer by market capitalisation, on August 3 announced its decision to acquire Gujarat-based cement maker Sanghi Industries (SIL). The Adani-group owned cement maker will acquire 56.74 percent shares of SIL from its promoters Ravi Sanghi and family at a price of Rs 114.22 per share, valuing the company at an enterprise value of Rs 5,000 crore. The acquisition, as stated, will be fully funded through internal accruals.
“This landmark acquisition is a significant step forward in Ambuja Cements’ accelerating growth journey,” Gautam Adani, Chairman of the Adani Group, said in a statement.
“By joining hands with SIL, Ambuja is poised to expand its market presence, strengthen its product portfolio, and reinforce its position as a leader in the construction materials sector,” he added.
This is supposed to be the third major acquisition of the Adani-group in the cement sector after its acquisition of Ambuja and ACC cements back in 2022.
Ambuja Cements expects the acquisition of Sanghi Industries to enable it to increase its aggregate cement production capacity by 9 percent to 73.6 million tonne per annum. Apart from capacity expansion, the group also announced its intent to expand the captive port at Sanghipuram to handle larger vessels. The deal will also provide Ambuja access to Sanghi's limestone reserve of nearly a billion tonne.
"In the next two years, Ambuja Cements will increase the cement production capacity at Sanghipuram to 15 million tonne per annum. With the acquistion of Sanghi Industries, our vision is to produce lowest cost clinker and then transport it to the markets of Gujarat, Maharashtra and Karnataka," said Karan Adani, CEO of Adani Ports and SEZ limited in his address to the media on Thursday. "With this, we are confident that we will emerge as the lowest cost suppliers of cement in the market," he added.
At 9.30 am on Thursday, Sanghi Industries stock was trading at Rs 105.40, up 4.98 percent or Rs 5 on the NSE. Meanwhile, Ambuja Cements stock traded in green at Rs 464, up 0.67 percent or Rs 3.10 from the previous close.
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