JSW Cement eyes stake in Orient Cement amid industry consolidation: Report

JSW Cement is also planning to list its cement business next year, and acquiring OCL could facilitate a reverse merger and expedite this process.

JSW Cement, led by Sajjan Jindal, has initiated a bid to acquire promoter stake in Orient Cement Ltd (OCL) from CK Birla, The Economic Times has reported. JSW Cement joins the Aditya Birla and Adani groups, which have been pursuing assets across the country amid a wave of consolidation in the cement industry.

The promoter stake in OCL, currently held by the Birla family and associated private investment vehicles, stands at 37.9 percent.

An acquisition of the stake would also trigger an open offer for an additional 26 percent from minority shareholders.

With OCL’s shares having surged 56 percent over the past three months in anticipation of a deal, the 63.9 percent stake could be valued at around Rs 4,546.54 crore, given the company’s market capitalisation of Rs 7,115.09 crore, the report said.

JSW Cement’s bid comes as a significant development in the industry. In 2022, JSW Cement, Adani, and Aditya Birla competed fiercely for the $6.5 billion acquisition of Holcim’s India assets, the largest M&A deal in India’s building materials sector. Adani emerged as the victor, becoming the second-largest player in the market overnight. Since then, Adani and Aditya Birla have acquired seven companies between them.

Moneycontrol couldn’t verified the report independently.

Recent industry activity has seen Adani and Ultratech focus on southern India, with Adani acquiring Penna Cement in June and Ultratech increasing its stake in India Cements to a majority control on July 28.

JSW Cement has intensified its efforts to acquire OCL, viewing it as a strategic opportunity to strengthen its position in the market.

After the Heidelberg and Penna Cement setbacks, the focus has shifted to OCL, which is considered a medium-sized asset and has been on JSW’s radar since the sale process was initiated.

JSW Cement is also planning to list its cement business in 2025 and acquiring OCL could facilitate a reverse merger and expedite this process, the report said.

Despite multiple attempts, messages and calls to Birla Group chairman CK Birla and OCL MD and CEO Deepak Khetrapal remained unanswered. A JSW spokesperson declined to comment, the report said.