Taking advantage of the Hindenburg effect, the Adani Group is back on its expansion path via an inorganic route. On Thursday, Ambuja Cements said it acquired Sanghi Industries (SIL) for a value of ₹5,000 crore.
The acquisition will be fully funded by internal accruals. Ambuja will acquire 56.74% of SIL from its existing promoter group, Ravi Sanghi & family.
With this acquisition, the Adani group is well on track to meet its 140 MTPA cement production capacity target by 2028. With SIL, Ambuja will expand its market share, strengthen its product portfolio, and strengthen its position as a leader in the construction materials sector, as per Gautama Adani.
Ambuja said it intends to make SIL the lowest-cost clinker producer in the country with its integrated manufacturing unit at Sanghipuram in Gujarat’s Kutch district.
It has a cement grinding unit with a capacity of 6.1 MTPA and two kilns with a clinker production capacity of 6.6 MTPA. It has a 130 MW captive power plant and a captive jetty at Sanghipuram.
Karan Adani, director of Ambuja Cements, said the company would also invest in deepening the captive port.
SIL’s limestone reserves of a billion tonnes will enable Ambuja to expand cement capacity at Sanghipuram to 15 MTPA in the next two years, along with expanding the captive port.
Ambuja Cements’ acquisition is an exciting opportunity for both shareholders, and we are optimistic about it. With this strategic partnership, Sanghi Industries will create a formidable force in the cement industry, enhancing value for all stakeholders involved, said Ravi Sanghi, CMD.
Through the acquisition, ACL will strengthen its market position and expand its cement production capacity from 67.5 MTPA to 73.6 MTPA. By 2025, the Adani group will have a capacity of 101 MTPA due to the ongoing capex of 14 MTPA and the commissioning of 5.5 MTPA capacity at Dahej and Ametha.
A bulk cement terminal is also located at Gujarat’s Navlakhi Port and Maharashtra’s Dharamtar Port. As well as 850 dealers, it has market presence in Gujarat, Madhya Pradesh, Rajasthan, Maharashtra, and Kerala. Most of the cement is transported by sea, which is environmentally friendly and cost-effective.
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