Government today cleared the proposal of Ambuja Cements to acquire 24 percent stake in its holding firm Holcim India, a move that will allow its parent Swiss giant LafargeHolcim to strengthen India footprint.
"The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, has approved the proposal for Ambuja Cements Ltd for acquisition of 24 percent shares in its holding company Holcim (India) Pvt Ltd from Holderind Investment Ltd," an official statement said.
The CCEA also allowed the "subsequent reverse merger through a share swap. This would entail outflow of Rs 3,500 crore." These transactions would enable Lafarge Holcim group to create a linear corporate structure (with Ambuja and ACC becoming parent and subsidiary) and with a view to harvest significant synergies from India operations, it added.
Both, Ambuja Cements and ACC are subsidiaries of world's largest cement maker LafargeHolcim. The group was founded in 2015 following the merger of Lafarge and Holcim.
"This will further strengthen all India footprints, debt free balance sheet and cash flow generation, bringing in huge prospects for further expansion and creation of employment opportunities," it added.
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