Adani New Deal: Another cement factory in Gautam Adani’s kitty, this action was seen in the shares.

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Adani New Deal: After the Supreme Court’s positive comment in the Hindenburg-Adani case, the shares of the group continue to rise. Meanwhile, news is coming that Gautam Adani has acquired another cement factory. Ambuja Cements, a company owned by Gautam Adani (ACL) Sanghi Industries Limited (SIL) has completed the acquisition. Information regarding this was given by the company in the exchange filing. The enterprise value of this deal is Rs 5185 crore. Adani Group has funded this deal through its internal sources. Now Ambuja Cement will have 54.51 percent stake in the company. After this news, shares of Ambuja Cement Limited were trading at Rs 504.60 at 11.30 am on Thursday with a rise of 0.70 percent i.e. Rs 3.50. Whereas, shares of Sanghi Industries are trading at Rs 129.25 with a fall of 4.75 percent i.e. Rs 6.45. On August 3, 2023, Ambuja Cements had announced the purchase of 54.74% stake in Sanghi Industries from the existing promoter group Ravi Sanghi & Family.

Ambuja Cements Limited will be acquired from internal sources.

According to the company, Ambuja Cements Limited will purchase 56.74 percent stake of the company from the existing promoter group of Sanghi Industries Limited, Ravi Sanghi & Family. Ambuja Cements will fund this acquisition entirely from internal accruals. After the acquisition of Sandhi Industries, the production capacity of Ambuja Cement will increase to 73.6 metric tons annually. ACL’s target of achieving 140 MTPA capacity by 2028 will be achieved ahead of schedule. Along with this, Ambuja Cement aims to make Sanghi Industries the lowest cost clinker company in the country. Ambuja Cements is expected to gain a lot from buying Sanghi Industries and after this acquisition, the cement capacity of ACL will increase from the current 67.5 MTPA to 73.6 MTPA.

What were the assets of Sanghi Industries

Sanghi Industries was owned by Ravi Sanghi and family. He held 56.74 percent stake in the company. The company had India’s largest single location cement and clinker unit at Sanghipuram in Kutch district of Gujarat. This was the largest integrated unit that the company had. After the acquisition of Sanghi, Ambuja Cement will have the largest cement unit of the company. Sanghi’s cement unit is located on 2700 acres of land and is an integrated unit with 2 clinches and 6.6 MTPA along with 6.1 MTPA grinding unit. Along with this, the plant has a captive power plant of 130 MW. While there is also a 13 MW waste heat recovery system. The unit is also attached with a captive jetty at Sanghipuram.

How one company acquires another company

For a company to acquire another company (merger and acquisition), the two companies first negotiate. The boards of directors of both companies agree to an agreement to plan the acquisition. In this, details of acquisition, time limit, valuation of property, stock currency etc. are adjusted. Once the plan is made and agreed upon, Naubat (Form 23C and Form 1 Naubat) is issued. This includes the process and details of the acquisition. After issuing Naubat, it is presented to the Supreme Court or the Naubat Approval Officer. After receiving the approval, implementation of the acquisition is started as per the plan. In this, one company acquires control of the property, stock, and assets of another company. Following the acquisition, the various process, production, finance, and management systems of both companies are integrated. The various divided structures are transformed into a consolidated and organized structure.

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