UltraTech Cement buys JP group plants for Rs.16,500 crore

Mumbai: Aditya Birla-led UltraTech Cement on Sunday announced acquisition of Jaiprakash Associates Ltd's cement plants, with total capacity of 22.4 million tons per annum (mtpa), for Rs.16,500 crore (about $2.5 billion).

"UltraTech Cement has today (Sunday) entered into a binding MoU with Jaiprakash Associates for the acquisition of its identified cement plants having total cement capacity of 22.4 mtpa (including a 4 mtpa plant under implementation) situated in Madhya Pradesh, Uttar Pradesh, Himachal Pradesh, Uttarakhand, Andhra Pradesh and Karnataka," it said in a statement here.

"The parties have agreed to an enterprise value of Rs.16,500 crores.

"The assets will give the company access to the newer markets of Satna, UP East, Himachal Pradesh and coastal Andhra where it does not have a presence as of now. Upon consummation of the proposed transaction, the company's cement capacity will stand augmented to 90.7 mtpa (current 68.3 mtpa)," it added.

It was unclear whether this agreement includes two cement plants of Jaiprakash Associates, the purchase of which were cancelled last week by UltraTech owing to lack of necessary approvals.

UltraTech had on Friday said it was calling off that deal with Jaiprakash Associates, which has been selling its assets in a bid to reduce debt and improve its balance sheet.