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Sajjan Jindal-led JSW Cement considering promoter stake purchase in Orient Cement

| @indiablooms | Aug 01, 2024, at 04:15 am

Mumbai: Sajjan Jindal-led JSW Cement has launched a bid to acquire the promoter stake in Orient Cement Ltd (OCL) from CK Birla, according to a report by The Economic Times.

This bid places JSW Cement alongside the Aditya Birla and Adani groups, both of which are actively acquiring assets amid a wave of consolidation in the cement industry.

The promoter stake in OCL, currently held by the Birla family and associated private investment vehicles, is 37.9 percent.

Acquiring this stake would trigger an open offer for an additional 26 percent from minority shareholders.

With OCL's shares having risen by 56 percent over the past three months in anticipation of a deal, the combined 63.9 percent stake could be valued at approximately Rs 4,546.54 crore, based on the company's market capitalization of Rs 7,115.09 crore.

JSW Cement's move is significant in the industry, especially following the intense competition between JSW, Adani, and Aditya Birla for Holcim's India assets in 2022—a $6.5 billion deal that was the largest M&A transaction in India's building materials sector.

Adani won that bid, becoming the second-largest player in the market. Since then, Adani and Aditya Birla have collectively acquired seven companies.

Recent acquisitions by Adani and Ultratech have been concentrated in southern India, with Adani purchasing Penna Cement in June and Ultratech gaining majority control of India Cements on July 28.

JSW Cement has intensified its pursuit of OCL, viewing it as a strategic asset that could strengthen its market position.

The acquisition of OCL is seen as a potential catalyst for a reverse merger, which could expedite JSW Cement's planned listing of its cement business in 2025.

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