The slowdown in the economy has been a catalyst to these takeovers - helping the acquirer consolidate through capacity expansion without incurring high costs involved with setting up of a greenfield project. At the same time, the takeover has also facilitated an exit for the acquired company from a line of business that has turned unremunerative.

A comparison of these takeovers makes some interesting revelations. The game does not stop with the completion of acquisition. There are some clear winners when these acquisitions are seen in the light of comparative costs incurred in taking over a cementmanufacturer.

Larsen & Toubro, which is in the process of acquiring Narmada Cement, has borne the lowest cost at Rs 2025 per tonne. The cost of acquisition is pegged at Rs 243 crore for the 1.2 million tonne plant.

While the cost of takeover is the lowest, Narmada Cement is a loss-making company and an insignificant market player. ``To add to the list of negative factors, availability of backup power is only 40 per cent. This means that inhouse power production can run only 40 per cent of the total installed capacity,'' says an analyst with a foreign brokerage.

On the other hand, the takeover of Dharani by Birlas has been the highest in terms of cost per annual tonne at Rs 8030. Dharani has a capacity of 0.066 million tonnes with a estimated cost of acquisition at Rs 53 crore. This includes cost of expansion to 0.9 million tonnes, which will involve an estimated expenditure of Rs 290 crore which gives an investment cost of Rs 3220 per annual tonne.

While the company boasts of 92 million tonnes oflimestone reserves, analyst point out that these reserves are shallow deposits and are spread over scattered areas. ``Besides, these areas are not supported by mining leases on hand and include areas reserved for exploitation by Tamil Nadu Cements which is under litigation,'' says a sector expert with a public sector mutual fund. The other takeover by Birlas, that of Digvijay Cement, has been at a cost of Rs 2344 per annual tonne. The company has a capacity of 1.225 million tonnes but has a split location plant.

A relatively cost-effective takeover has been that of Raasi Cement by India Cements last year. India Cements acquired the Andhra-based manufacturer at a price tag of Rs 445 crore with cost per annual tonne at Rs 2070, the lowest after Narmada Cement. The takeover is also advantageous for India Cement since Raasi is a profit-making company and a market leader in Andhra Pradesh.

``With this takeover, ICL will have a 30 per cent market share in the South which gives it a formidable position. Theacquisition has brought Raasi's ceramic and paper divisions under ICL's fold with 100 per cent backup power for the cement plant. The takeover has also given it a 40 per cent stake in Vishnu Cement although the matter is in the court,'' elaborates an analyst a financial institution.

The other two acquisitions have been those of Modi Cements by Gujarat Ambuja and Tisco's cement division by Lafarge at costs per tonne of Rs 3095 and Rs 3180, respectively. The manufacturing capacity of the two plants is 1.15 million tonnes and 1.73 million tonnes. ``The biggest problem with Modi Cement is that it is located in the most cement surplus MP market,'' says a sector analyst. ``The takeover at a cost of Rs 240 crore was under the BIFR scheme of closed units with accumulated losses of over Rs 329 crore,'' he adds.

``In the case of Tisco, name plate capacity is for slag cement which has a restricted marketability in some conventional markets in east India,'' he points out. Tisco's cement division was acquired at acost of Rs 550 crore.