Ambuja Cement, one of India’s oldest cement manufacturers, on Friday appointed Karan Adani, as chairman. Business tycoon Gautam Adani has also joined the company. The company appointed NS Sekhsaria as chairman emeritus after he retired from the position of director. Meanwhile, LIC nominee director Arun Kumar Anand tendered his resignation from the board. Mr. Karan Adani, Chief Executive Officer of SEZ Limited (APSEZ), leads APSEZ to form a combined logistics firm.
The changing of the guard comes hours after the Adani Group completed its $6.4 billion acquisition of Ambuja Cements and its subsidiary ACC Ltd from Switzerland’s Holcim Group. The two cement manufacturers together make Adani the second largest cement player in the Indian market after Aditya Birla Group’s UltraTech Cement.
Adani Group chairman Gautam Adani, now India’s richest person, has beaten Bernard Arnault and Jeff Bezos to become the world’s second-richest person, behind only Tesla co-founder and CEO Elon Musk, according to Forbes on Friday. The transaction with Holcim included its entire 63.11% stake in Ambuja Cement and a 4.48% direct stake in ACC. Ambuja owns a 50.05% stake in ACC. Shares of Ambuja Cement and ACC were down 4.17% and 5.1% around 3.20 pm on Friday after sharp gains.
The Associated Cement Companies Ltd., ACC Ltd came into existence on August 1, 1996. The business was shaped by a union of ten standing cement firms. In the year 1944, they structured the nation’s first completely native cement plant. In the year 1956, they made a bulk cement yard at Okhla, Delhi.
In these years, Adani Group has placed itself to be the market front-runner in its transportation logistics and energy utility collection productions, concentrating on large-scale structure development in India. He achieved everything one dreamed of. He knows how to play the game! Gautam Adani’s corporate judgment, concentration level, positive attitude, and guts to take chances are the main reasons behind his achievements.
Entry Of Adani Into Ambuja Cement’s Board Members
Gautam Adani’s group has completed the acquisition of India’s major cement producers Ambuja Cements and ACC. The group has now become the second largest cement player in the country. Holcim structured a deal with Adani Group on Friday by selling its entire stake in Ambuja Cements for ₹385 per share and ACC for ₹2,300 per share. Cash revenues for Holcim reached $6.4 billion.
Switzerland-based Holcim said in a statement that the group has closed the sale of its India business to the Adani Group, comprising its entire stake in Ambuja Cements for ₹ 385 crores and ACC for ₹ 2,300 crores. Holcim sold its entire 63.11% stake in Ambuja Cements, which owns a 50.05% stake in ACC, and its 4.48% direct stake in ACC.
The transaction strengthens Holcim’s balance sheet and allows the company to continue its acquisition strategy, which builds on recent investments in solutions and products of more than CHF 5 billion, the statement said. Jan Jenisch, CEO of Holcim, said: “I would like to thank our 10,700 Indian colleagues who have played a role in the development of our business over the years with their unwavering commitment. I am convinced that the Adani Group is the right home for them and our customers so that they will continue to prosper in the future.
The deal was completed by the transfer of 100% of Holderind Investments to Endeavor Trade and Investment in Ambuja and ACC. Endeavor Trade and Investment belongs to the Adani Group, while Holderind, based in Mauritius, is the holding company of Holcim. Jenisch commented: “This sale is a step in our evolution to become a worldwide leader in improved and workable building solutions, strengthening our balance page and giving us the weapons to boost our policy.”
The acquisition of Ambuja and ACC makes it the largest acquisition by Adani and the largest ever infrastructure and materials M&A transaction in India. Both Ambuja and ACC shares fell sharply today. However, earlier in the day, Ambuja shares hit a fresh 52-week high of ₹550.15 before correcting.
On the BSE, shares of Ambuja closed at ₹ 516.30 apiece, down 4.19%. The market capitalization of the company is around ₹ 1,02,518.86 crore. ACC shares fell 4.90% to end at ₹2614.80 apiece. The market valuation of the company is ₹ 49,102.61 crore.
In terms of market share, with the acquisition of Ambuja Cements and ACC, the Adani Group has a market valuation of ₹ 1,51,621.47 crore in the sector – making it the second largest cement player. Currently, Ultratech Cement is the largest player with a market valuation of over ₹1.87 crores. Gautam Adani’s elder son Karan Adani is speculated to oversee the family’s cement business.
Following the change in management, ACC announced that the Board of Directors approved the extension of the current financial year to March 31, 2023, and the change of the Company’s financial year from January 1 – December 31 of each year to April 1 – March 31 of each year.
Also on Friday, according to a regulatory filing, Ambuja received board approval to issue nearly Rs 47.75 crore, each convertible or exchangeable for — 1 fully paid equity share of ₹ 2 each — Harmonia Trade and Investment on a preferential basis.
Under Karan’s leadership, both Ambuja Cements and ACC will benefit from synergies with Adani’s integrated infrastructure platform, particularly in the areas of raw materials, renewable energy, and logistics, where Adani Portfolio companies have notable experience and expertise.