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Ultratech-Star Cement Deal: Adani Group’s efforts to acquire cement companies in the north-eastern state have suffered a major setback. The company on which Adani Group was eyeing has sold its stake in the company to Adani Group’s biggest rival in the cement business, Aditya Birla Group’s UltraTech Cement. UltraTech Cement Limited has announced that it is going to buy 8.69 percent non-controlling minority stake in Star Cement Limited for Rs 851 crore.
UltraTech Cement’s board approved the deal
UltraTech Cement said in its regulatory filing with the stock exchanges that some promoters and promoter group entities of Star Cement Limited have approached the company to sell stake in Star Cement. A meeting of the Board of Directors of the company was held today in which the proposal of Star Cement was discussed and the Board of Directors has approved the purchase of 3.70 crore equity shares at Rs 235 as non-minority stake.
Rs 851 crore paid in cash
In the disclosure, UltraTech Cement said that the process of purchasing stake in Star Cement will be completed within a month and Rs 851 crore will be paid in cash for this deal. If we look at the turnover of Star Cement in the last three years, the turnover was Rs 2221.81 crore in the financial year 2021-22, Rs 2704.84 crore in the financial year 2022-23 and Rs 2910.66 crore in 2023-24. After this deal, Star Cement stock is trading at Rs 235.60 with a rise of 2.55 percent. Whereas the stock of UltraTech Cement is trading with a decline.
UltraTech gave a shock!
Earlier in the first week of this month, it was reported that Adani Group is preparing to acquire a cement company in the north-eastern state. And talks are also going on for the acquisition of the group’s cement company Ambuja Cement with Star Cement. Due to this news, there was a sharp rise in the stock of Star Cement. Moneycontrol had reported in its report that Adani Group has appointed consultancy firm EY to review the transaction. Star Cement has the highest market share in the north-eastern states. The production capacity of the company is 7.7 million tonnes per year, which the company has targeted to increase to 30 million tonnes by 2030. But the deal on which Adani Group was eyeing seems to be going out of hand at the moment.
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