Ambuja Cements Ltd. signed a definitive agreement to acquire My Home Group's 1.5 MTPA cement grinding unit in Tuticorin, Tamil Nadu. The acquisition estimated at a total value of Rs 413.75 crore, through internal accruals, will aid in enhancing the coastal footprint across southern markets of Tamil Nadu and Kerala, according to an exchange filing.
The total cement capacity of Adani Group stands at 78.9 MTPA, the filing said.
The asset, with 61 acres of land, will help access the southern market with 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 the 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.
Furthermore, the limited availability of limestone in Tamil Nadu presents a unique competitive advantage, with coastal movement of clinker from the Sanghipuram Plant ensuring cost-efficient operations, it said.
"We are glad to announce this acquisition, strengthening our foothold in the region and aligning perfectly with our commitment to delivering high-quality products and services to our customers," Ajay Kapur, chief executive officer of cement business at Adani Group said.
In addition to the infrastructure and geographical advantages, he said, Ambuja Cements will also inherit the existing dealer network and retain current employees, facilitating a smooth transition and enabling the rapid ramp-up of utilisation.
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