Coal news and updates

The deal is to acquire the entire 5.5 million tonnes cement business of Reliance Infrastructure.

 

Birla Corporation Ltd., (BCL) is hopeful that a deal to acquire the cement business of Reliance Infrastructure Ltd., will be through by the second quarter of this fiscal, chairman H.V. Lodha said.

 

The total cement production capacity of BCL would increase to 15.5 million tonnes once the deal went past all the regulatory clearances, he said adding that the acquired cement units would give BCL a footprint in the high-demand central region.

 

BCL is mainly into cement and jute and has manufacturing units in north, central and eastern parts of the country.

 

Value of Rs.4,800-crore

It signed a deal to acquire the entire 5.5 million tonnes cement business of Reliance Infrastructure Ltd., for an enterprise value of Rs.4,800 crore.

 

This is to be done through BCL’s acquisition of Reliance Cement Company Pvt Ltd., which has three cement units in Madhya Pradesh, Uttar Pradesh and Maharashtra.

 

The deal also includes raw material sources.

 

Mr. Lodha assuaged shareholders’ concerns about funding this buy, saying that the company was conservative about its borrowings.

 

“It is a good fit,” he said, adding that the company was in the process of implementing the acquisition. Indications were that the fresh debt for this deal would not exceed Rs.1000 crore.

 

He also said that he expected the new company to enhance BCL’s efficiency.

Source:The Hindu.com