New Delhi: The Indian billionaire Gautam Adani’s Adani Group is in advanced talks with debt-ridden Jaiprakash Power Ventures Ltd. to buy its cement unit, according to people familiar with the development.
One of the sources claimed that the ports-to-power conglomerate could spend roughly Rs 5,000 crore ($606 million) to acquire a cement grinding plant and other less valuable assets. The source asked to remain anonymous because the information is confidential.
The purchase will be made by one of the cement businesses that Asia’s richest person recently acquired, according to the sources, who also stated that an announcement was anticipated as soon as this week. Although the conversations are far along, they might still be postponed or fail, according to the sources. The deal was previously reported by the Indian news outlet ET NOW without a price tag.
The agreement will support the Adani Group’s efforts to maintain its sudden dominance in the cement industry, which began after it acquired Ambuja Cements Ltd. and ACC Ltd. from Holcim Ltd. of Switzerland in May, transforming it into India’s second-largest cement producer almost immediately with an installed production capacity of 67.5 million tonnes annually.
Representatives of the Adani Group declined to comment. Representatives of Jaiprakash Associates were not immediately available for comment.
The factory can grind 2 million tonnes of cement annually. It started running in Nigrie, in the Madhya Pradesh state of central India, in October 2014.
In order to reduce debt, Jaiprakash Associates’ board of directors agreed to sell the firm’ “major” cement operations, according to a stock exchange filing made on Monday. Jaiprakash Power Ventures announced separately that its board is exploring to sell the Nigrie cement grinding facility as well as other non-core assets, without mentioning any potential purchasers.
Last month, Adani Group announced intentions to invest 200 billion rupees in its recently acquired cement industry and increase its ability to produce 140 million tonnes of cement over the course of five years.
