Adani Group has received regulatory approval for an open offer of nearly rupees 311.6 billion ($3.9 billion) to buy the remaining shares of two Indian cement producers, following Holcim Ltd.’s decision. in May to sell his majority stake to the conglomerate.
The group, led by Asia’s richest person Gautam Adani, has offered to buy 26 percent of Ambuja Cements Ltd. to buy for Rs 385 per share and the same stake for Rs 2,300 per share from ACC Ltd., according to two exchange filings filed Friday by ICICI Securities Ltd. and Deutsche Bank AG, advising Adani.
The open offer for both cement companies will run from Aug. 26 to Sept. 9, the archives said.
Bloomberg reported earlier in the day that the port-to-power conglomerate received a nod from the Securities & Exchange Board of India for this open offering, citing people familiar with the development.
Shares for Ambuja and ACC cut their gains on Friday after Bloomberg’s story was published. They later gained some ground to end the day up 2.7 percent and 1.2 percent respectively.
Asia’s Richest Man Forges $10.5 Billion Deal With Holcim
Under Indian stock exchange rules, acquiring 25 percent or more of the shares in a local publicly traded company will trigger a mandatory open offer, where minority shareholders can choose to sell their stake to the new investor at a predetermined price.
Adani’s open offer price for Ambuja is 6 percent off Thursday’s closing price, while that for ACC is 1 percent off, data collected by Bloomberg shows.
The deal was also approved by the Indian antitrust regulator last week.
The Holcim transaction will push the Adani Group to become India’s second largest cement producer virtually overnight in an extremely fragmented and competitive market.
Holcim agreed in May to sell its 63 percent stake in Mumbai-listed Ambuja Cements to Adani Group, which then said it plans to spend approximately $10.5 billion on the share purchases and an open offer for Ambuja and related entities.
As part of the deal, Adani will inherit Ambuja’s majority stake in another publicly traded cement producer, ACC, and buy Holcim’s direct 4.5 percent stake in the unit.
–With help from PR Sanjai and Dhwani Pandya.
(Except for the headline, this story has not been edited by DailyExpertNews staff and has been published from a syndicated feed.)