Holcim buys 11% more in ACIL at Rs 589 crores

Swiss cement giant Holcim has decided to take complete control of Ambuja Cements India (ACIL), the local company through which it controls ACC, India’s largest cement major. Holcim will buy 11% from Ambuja Cement (ACL), formerly Gujarat Ambuja, for Rs 589 crore. Ambuja Cement, which created ACIL in 2000 and offered stakes to the Government of Singapore and American International Group (AIG) in what was then the country’s largest private equity transaction, will now completely exit the company.

The move will enable Holcim to own 100% of an entity that owns stakes in two of India’s largest cement players. ACIL controls 42.88% in ACC, India’s largest cement maker with a 13% market share. ACIL also owns 9.9% in Ambuja Cement, the third-biggest cement-maker with a 10% market share. Holcim directly owns 36% in Ambuja Cement.

In 1999, Ambuja Cement (ACL) stunned corporate India by buying the Tata Group’s 14% stake in ACC. The audacious move clearly signaled the company’s ambition in dominating the cement market. Two years later, in order to lessen the cost of the acquisition, Ambuja transferred its 14.5% stake in ACC to Ambuja Cement India (ACIL) and brought in the Government of Singapore and AIG as investors.