UltraTech says it has no intention to delist India Cements

UltraTech Cement does not intend to delist shares of India Cements after it acquires additional stake in the company through an open offer, the company said on Monday. This comes a day after the country’s largest cement producer’s acquisition of additional stake in the Chennai-based company.

The Aditya Birla Group company had acquired a near 23% stake in India Cements last month. Terming it a “non-controlling financial stake” then, UltraTech followed this up by announcing that it will acquire another 32.72% in the company from its promoters and its associates.

This has triggered a mandatory open offer by UltraTech for shareholders of India Cements for another 26% in the company. “The Acquirer does not have an intention to delist the Target Company pursuant to this Open Offer,” UltraTech said in an exchange filing on Monday.

UltraTech has appointed Axis Capital as the manager for this open offer, and launched the offer for acquiring 8,05,73,273 shares in the company at Rs 390 a piece. UltraTech acquired stake from promoters also at this price, while its initial 23% from investor Radhakishan Damani came at Rs 268 a piece.

The open offer price is at a premium of 4.6% to Monday’s closing price of 372.85 rupees. Shares of India Cements, though, have rallied more than 42% after UltraTech first bought a stake in the company in June.UltraTech, which has a production capacity of more than 150 million tonnes currently, aims to reach a capacity of 200 million tonnes by March 2027. It commands a market share of nearly one-fourth of the Indian market, but has a relatively lower presence in South India.The buyout of India Cements, which is one of the largest producers of cement in the region with a capacity of 13 million tonne in southern India itself, is seen strengthening the company’s presence in the region as it looks to maintain its dominance across the country.