UltraTech Cement gets CCI's nod to acquire majority stake in India Cements

    New Delhi, Dec 20 (PTI) The Competition Commission of India (CCI) on Friday cleared billionaire Kumar Mangalam Birla-promoted UltraTech Cement's proposal to acquire a majority stake in India Cements.
    "The proposed combination envisages UltraTech Cement Ltd's (UltraTech/acquirer) acquisition of 32.72 per cent of the paid-up equity share capital of India Cements Ltd (India Cements/target) from the promoters and members of the promoter group of India Cements and Sri Saradha Logistics Pvt Ltd," CCI said in a release.
    The fair trade regulator also granted its clearance to UltraTech Cement to acquire up to 26 per cent of the paid-up equity share capital of India Cements by way of an open offer, it added.
    UltraTech is engaged in the business of manufacturing and sales of grey cement, white cement, ready-mix concrete, clinker, and building products in India.
    It is a subsidiary of Grasim Industries Ltd, while India Cements operates core and non-core businesses. The core business of India Cements is the manufacturing and sales of grey cement and ready-mix concrete.
    "Competition Commission of India (CCI) approves UltraTech Cement Ltd's acquisition of The India Cements Ltd," the competition watchdog said.
    The deals beyond a certain threshold require approval from the regulator, which keeps a tab on unfair business practices and promotes fair competition in the marketplace.
    In July this year, UltraTech Cement announced the acquisition of a 32.72 per cent stake in India Cements from promoters and their associates in a Rs 3,954 deal in a move to expand its footprint in the highly competitive and fast-growing southern cement market, particularly Tamil Nadu.
    Besides, it had also announced a Rs 3,142.35 crore open offer to acquire a 26 per cent share of ICL from its shareholders.
    UltraTech leads the Indian cement market with a consolidated capacity of 156.66 million tonnes per annum (MTPA) of grey cement.
    According to J Sagar Associates, Advocates & Solicitors (JSA), this proposed acquisition is an endeavour to extend UltraTech's footprint and presence in the highly
fragmented, competitive and fast-growing Southern market in the country, particularly Tamil Nadu, where it has a limited presence.
    JSA acted as the sole counsel for UltraTech.
    "This is the first instance of the CCI unconditionally approving a transaction post-issuance of a show cause notice under the amended merger control regime.
    "It was the first long-form (Form II) merger notification filed under the new merger control regime, which came into force on September 10, 2024, with the CCI approval taking 25 days," JSA said in a statement.
    UltraTech is followed by billionaire Gautam Adani-led Adani Group, which is rapidly pacing up its capacity through acquisitions and capacity expansions.
    Both cement makers are rapidly scaling up their capacity. Adani Group aspires to have 140 MTPA capacity by FY28, while UltraTech expects to have 200 MTPA by FY27.

(This story has not been edited by THE WEEK and is auto-generated from PTI)