Ambuja Cements Ltd. has completed the acquisition of a cement grinding unit in Tamil Nadu's Tuticorin. The unit has a capacity of 1.5 million tonnes per annum. The Adani Group cement-maker had entered into a definitive agreement with My Home Industries Pvt. earlier this month to buy the cement grinding unit for Rs 413.75 crore.
The acquisition will be funded through internal accruals and aid in enhancing the coastal footprint across the southern markets of Tamil Nadu and Kerala.
The asset, with 61 acres of land, will help access the southern market with the coastal movement of clinker from Gujarat, according to Citi Research. "It also has a long-term fly-ash supply agreement," the research firm said in an April 15 note.
Ambuja Cements will leverage its coastal footprint and state-of-the-art marine infrastructure and equipment, ensuring that the best-quality products are delivered.
"This acquisition provides access to the southern market customers with an opportunity to experience and instill their trust in one of the most iconic and trusted brands—Ambuja Cement," the filing said.
The limited availability of limestone in Tamil Nadu also presents a unique competitive advantage, with the coastal movement of clinker from the Sanghipuram plant ensuring cost-efficient operations, it said.
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