Construction Mirror Article detail

The Adani family has invested ?6,661 crore in Ambuja Cements, increasing its stake to 66.7%. This marks the second fund infusion since late-2022, when ?5,000 crore  was invested through warrants. The total investment of ?11,661 crore aims to enhance capital flexibility for growth and strategic initiatives. Adani Cement,  comprising ACC and Ambuja Cements, targets a production capacity of 140 million tonnes by 2028. The funds will support capacity expansion, operational efficiency,  and strategic initiatives, including resource optimization and supply chain enhancements.

 

The Adani family has infused ?6,661 crore into Ambuja Cements, raising its stake by 3.6% to 66.7%. This is the second fund infusion since late-2022 when the promoter  had invested ?5,000 crore into the company through warrants.

 

"With this, promoters have infused ?11,661 cr in Ambuja post acquisition, giving it capital flexibility for accelerated growth, capital management initiatives and best-in-class balance sheet strength to accomplish various strategic initiatives," the company said in a statement. Adani Cement - comprising ACC and Ambuja Cements - aims to have production capacity of 140 million tonne (mt) by 2028. The country's second-largest producer of cement  currently has the capacity to produce over 77 mt of cement a year.

 

Apart from helping reach this capacity target, the funds will be instrumental for various strategic initiatives, including debottlenecking for operational  efficiencies and bringing in efficiencies across resources and supply chain, the company said in a statement.

 

The fresh investment comes through promoter entity Harmonia Trade and Investment which converted 212 million warrants into Ambuja shares. The cement company's  board on Thursday approved the conversion. The announcement came during market hours, sending the shares of Ambuja Cements nearly 2% higher on the NSE to ?612.35. "We are thrilled to announce Adani family's decision to increase their stake in Ambuja," said CEOAjay Kapur. "This infusion of funds provides Ambuja capital  flexibility for fast-tracked growth, capital management initiatives and best-in-class balance sheet strength," he said.Barclays Bank PLC, MUFG Bank and Standard  Chartered Bank were the advisors for the transaction.The Adani group forayed into the cement space by acquiring Ambuja Cements and ACC in 2022 for more than  $10 billion from Holcim. It was the largest acquisition in the materials space.Apart from Adani Cement, several other players are adding capacities as they expect  demand for cement to remain robust over the next few years, helped by government-led spending on infrastructure.