Dalmia Cement (Bharat) Ltd is set to acquire Jaiprakash Associates cement units, clinker units, and power plants at an enterprise value of Rs 5,666 crore. The acquisition will give Dalmia group an additional 9.4 million tonnes of cement and clinker capacity. The cement, clinker and power plants to be acquired are situated in the states of Madhya Pradesh, Uttar Pradesh and Chattisgarh. The proceeds from the divestment will be used to repay the debts of Jaiprakash Associates Ltd (JAL). The company sold a controlling stake of more than 2 MTPA cement capacity to Dalmia Group in 2015 and divested more than 20 MTPA cement capacity in the past few years. JAL has an aggregate capacity of approximately 6 million tonnes per annum and Jaiprakash Power Ventures Ltd has around 4 MTPS.
The acquisition of assets of JP Associates will let Dalmia expand its footprint in the central region. It is the fourth-largest cement manufacturing company in India by installed capacity with currently pegged at 37 million tonnes. Dalmia reported a 76.84% decline in its consolidated net profit for the quarter ended September 2022. The shares of Dalmia Bharat Ltd rose over 4% on BSE to Rs 1922.95 on Monday while Jaiprakash Associates’ shares surged over 9% and were locked in the upper circuit at Rs 11.74 on NSE. The 30-share BSE Sensex on the other hand was trading at 62,130.57, down 51 points or 0.08%.
“With the sale of cement capacity of 9.4 MTPA in favour of Dalmia Cement (Bharat) ltd. (DCBL), we hope and pray having demonstrated its creditable working, JAL will further ‘cement’ its credentials of being a trustworthy organization in the infrastructure segment of the country in times to come,” said Manoj Gaur, Executive Chairman of Jaiprakash Associates Ltd.