Ambuja Cements Ltd, part of billionaire Gautam Adani-led Adani Group, will merge its subsidiaries ACC Ltd and Orient Cement with the company, leading to the setting up of 'one cement platform' and a pan-India cement powerhouse.
Post-merger of the subsidiaries - ACC Ltd, Orient Cement, Penna Cement and Sanghi Industries "will become an integral part of Ambuja" with a capacity of 107 million tonnes per annum.
The board of Ambuja Cements Ltd (ACL) on Monday approved the scheme of amalgamation of merging ACC and Orient Cement.
"The merger will unlock greater operational efficiencies, optimise manufacturing and logistics, and enable efficient capital deployment. These improvements will boost profitability, support capacity expansion, and enhance long-term shareholder returns," said ACL in a statement.
As per the scheme, for every 100 equity shares of ACC with a face value of Rs 10 each, Ambuja will issue 328 equity shares with a face value of Rs 2 each to eligible shareholders of ACC.
Also, for every 100 equity shares of Orient Cement with a face value of Re 1 each, Ambuja Cements will issue 33 equity shares with a face value of Rs 2 each, to eligible shareholders of Orient Cement.
"This initiative aligns with Ambuja Cements' strategic plan to increase cement production capacity from 107 MTPA to 155 MTPA by FY28, facilitating efficient capital allocation and prompt adaptation to market requirements," it said.
Currently, ACL holds a 50.05 per cent share in ACC, 72.66 per cent in Orient Cement, which it acquired from CK Birla, and 99.94 per cent in the Hyderabad-based Penna Industries. It owns 58.08 per cent share in Sanghi Industries.
The "merger of Sanghi and Penna with Ambuja" was approved by ACL board in December last year, and the process is "currently under statutory approval," the company informed.
"Promoter & Promoter Group holding in Ambuja Cements will be reduced to 60.94 per cent from 67.65 per cent post approval of all ongoing and proposed scheme of merger of Sanghi, Penna, Orient and ACC," it said.
Karan Adani, Non-Executive Director - Ambuja Cements, Adani Group, said the consolidation represents a transformational step in building a globally competitive, integrated cement and building materials organisation.
"By bringing Ambuja Cements, ACC, and Orient Cement under a single corporate structure, we are strengthening our ability to drive operational excellence, accelerate growth, and deliver sustainable long-term value. This merger builds on our already proven track record to further position the business to drive efficiency and productivity," he said.
Over the appointed date for the proposed merger, ACL said, "For ACC Ltd, the appointed date is January 1, 2026 and for Orient Cement Ltd, appointed date is May 1, 2025."
According to the company, these mergers require "no approval of the Competition Commission of India (CCI)" as these transactions are intra-group merger.
The merger will simplify and rationalise the network, branding and sales promotion-related spends. This will help optimise costs and improve margin by at least Rs 100 per metric tonne.
The amalgamation also eliminates "structural duplication, reduces administrative costs, and enables faster, more agile decision-making.
"In addition, there will be no specific MSA required with ACC, Orient, Penna & Sanghi as these subsidiaries will become an integral part of Ambuja Cements," it said.
A master supply agreement (MSA) is required to share resources, such as cement, clinker, raw materials, and toll grinding for cost savings, leveraging their combined scale.
Ambuja Cements, which has crossed 100 MTPA (Million Tonnes Per Annum) capacity in FY25 in a record time, mainly through acquisitions, now aims to reach 118 MTPA by FY26 and 140 MTPA by FY28, primarily through brownfield expansion projects.
Adani Group is a new entrant in the cement sector. It jumped into the cement sector in September 2022 after acquiring controlling stakes in Ambuja Cement from Swiss firm Holcim for cash proceeds of USD 6.4 billion (about Rs 51,000 crore).
Ambuja Cements owned a 51 per cent stake in ACC Ltd, pursued inorganic growth, acquiring small companies such as Hyderabad-based Penna Cement and Saurastra-based Sanghi Industries. Earlier this year, it also acquired Orient Cement from the CK Birla group.
