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Cementing LafargeHolicim Deal
Cementing LafargeHolicim Deal
Domestic detergents maker Nirma Ltd, agreed to buy cement business of LafargeHolcim for $1.4 billion (i.e. around Rs.9,400 crore) on July 11, 2016. The deal will be financed partly by the largest rupee bond issue worth Rs.4,000-crore. This deal will help Nirma to emerge as one of India's top 10 cement players and will take their cement business to the next level. Nirma will have a substantial presence in cement market of East through this deal.
1. On July11, 2016 Nirma Ltd agreed to buy Lafarge Indias cement assets from LafargeHolcim at a value of $1.4 billion (around Rs.9,400 crore) subject to an approval by the Competition Commission of India (CCI).
2. The purchase will be finanaced by an equal mix of equity and debt.
3. Amount of Rs.4,000 crore will be raised from the domestic corporate bond market and balance amount will be raised through loans.
4. Some banks have offered a term loan of 2-5 years to finance this deal.
5. Upon completion of the deal, Nirma will emerge as one of India's top 10 cement players with a footprint in the East, North and West markets through 13 million tonnes of cement capacity and over 72 ready mix plants.
6. Through this it will have a substantial presence in cement market in the East and will help them to take their cement business to the next level.
7. LafargeHolcim will continue to operate in India through its subsidiaries ACC Ltd and Ambuja Cements Ltd. with a combined cement capacity of more than 60 million tonnes per annum (mtpa).
8. The deal, once complete, will be the second largest cement transaction of 2016.
