Ambuja Cements Approves Merger Of Sanghi Industries, Penna Cement With Itself

Ambuja Cements Ltd.'s board on Tuesday approved the merger of its recently acquired entities—Sanghi Industries Ltd. and Penna Cement Industries Ltd.—with itself through separate schemes of arrangement.

The Adani Group cement-maker will issue 12 equity shares of face value of Rs 2 each for every 100 equity shares of Sanghi Industries of face value Rs 10. The eligible shareholders of Sanghi Industries will become the shareholders of Ambuja Cements, according to an exchange filing.

Subject to requisite approvals, the transaction is expected to be completed within 9-12 months, it added.

Notably, Ambuja Cements holds 58.08% in Sanghi Industries and fully owns Penna Cement.

Sanghi Industries, acquired by Ambuja in 2023 at an enterprise value of Rs 5,000 crore, has a clinker capacity of 6.6 million tonnes per annum, cement capacity of 6.1 MTPA, and limestone reserves of one billion tonnes.

SIL's Sanghipuram plant is India’s largest single-location cement and clinker unit by capacity, with a captive jetty and captive power plant.

Ambuja Cements acquired Hyderabad-based Penna Cement at an enterprise value of Rs 10,422 crore in August. The company has four integrated plants in Andhra Pradesh and Telangana, along with a grinding unit in Maharashtra. It has an operational capacity of 10 MTPA.

Ajay Kapur, CEO of cement business of the Adani Group, said the merger aims to make Ambuja Cements more competitive and efficient, with enhanced working capital management and internal funds to support business growth.

"Unified cash flow management will pool resources for faster expansion and cost savings in administration and governance, thereby simplifying compliance requirements. This advancement through a larger entity will increase market competitiveness and deliver greater value to our shareholders," he said in a statement.

Disclaimer: NDTV is a subsidiary of AMG Media Networks Ltd., an Adani Group Company.