The Adani Group’s cement and building material subsidiary, Ambuja Cement, announced the signing of a legally binding contract to purchase Penna Cement Industries Ltd (PCIL) for an enterprise value of INR 10,422 crore.
P. Pratap Reddy and family, PCIL’s current promoter group, would sell all of its shares to Ambuja. The company has released a press release stating that internal accruals will be used to fully fund the transaction.
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“By acquiring PCIL, Ambuja is poised to expand its market presence in south India and reinforce its position as a pan-India leader in the cement industry. PCIL’s strategic location and sufficient limestone reserves provide an opportunity to increase cement capacity through debottlenecking and additional investment,” stated Ajay Kapur, CEO & whole time director of ambuja cement.
“Importantly, the bulk cement terminals (BCTs) will prove to be a game changer by giving access to the eastern and southern parts of peninsular India, apart from an entry to Sri Lanka, through the sea route,” he added.
The integration of PCIL’s current dealer network into Adani Cement’s extensive marketing system is a calculated move aimed at consolidating market presence and generating a potent synergy within the industry.
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