On Thursday, UltraTech Cement announced its acquisition of Kesoram Industries’ cement business in an all-stock deal valued at 53.79 billion rupees ($645.41 million), enhancing its capacity in a highly competitive sector.
Under the terms of the deal, UltraTech will issue one share for every 52 shares of Kesoram, gaining ownership of two integrated cement units located in the southern Indian states of Karnataka and Telangana.
The deal translates to an offer price of 173.15 rupees per share, representing a 33.75% premium to Kesoram’s last closing price.
In a statement, UltraTech highlighted that the transaction provides an opportunity to expand its presence in the Western and Southern markets of India, which are characterized by being highly fragmented, competitive, and fast-growing.
Furthermore, the proposed acquisition is expected to accelerate UltraTech’s progress toward achieving its stated goal of reaching a cement capacity of 200 million tons per annum (mtpa) in India.
This strategic move underscores UltraTech Cement’s commitment to growth and market leadership in the dynamic cement industry.