UltraTech Cement announced on Thursday it will buy a 23% stake in Chennai-based India Cements (ICL). UltraTech, owned by the Aditya Birla Group, will purchase 70.6 million shares of India Cements at up to Rs 267 per share, totaling Rs 1,885 crore.
“The board of directors approved buying up to 7.06 crore equity shares of India Cements at up to Rs 267 per share,” said UltraTech. The deal, worth Rs 1,885 crore, is expected to be completed in one month and will be paid in cash.
After the announcement, UltraTech’s share price rose over 6%, and India Cements’ share price jumped 13.7% to a 52-week high of Rs 299. As of March 2024, the promoter group of India Cements owns 28.42% of the company, and investor Radhakishan Damani and his associates hold 20.78%.
India Cements has a cement capacity of 14.45 million tonnes per year, mostly in South India. “At Rs 267 per share, UltraTech’s investment is valued at $85 per tonne,” said an industry analyst. India Cements reported a turnover of Rs 5,112 crore in 2023-24, compared to Rs 5,608 crore in 2022-23 and Rs 4,858 crore in 2021-22.