Ultratech Cement and Nirma Group are said to be the top contenders for Emami Group’s cement division, said sources in the know of the development.
The other bidders who had expressed interest included Ambuja Cements, Germany’s HeidelbergCement, Dalmia Cement, Shree Cement.
Some of the leading private equity majors like Blackstone, KKR and TPG Capital are also said to be interested in partnering the above corporates to put in a joint bid.
“UltraTech Cement is the top contender for Emami Cement but Nirma may also emerge as the dark horse, like it acquired Lafarge India, outbidding others,” a banker told The Hindu.
Emami Group has roped in Arpwood Capital Ltd. and Credit Suisse Group to manage the sale of its cement unit for which it is seeking a valuation of about ₹7,000 crore. “There is a mismatch between the expectations of the seller and buyers as the sellers are also including the mining leases in Chhattisgarh, Rajasthan and Andhra Pradesh as part of the valuation,” said the source, adding the deal will be done at valuation of about ₹5,000 crore and is likely to be announced by December.
Emami Cement currently operates three manufacturing facilities at Risda in Madhya Pradesh, Panagrah in West Bengal and Bhabua in Bihar, with a total capacity of about six million tonnes per annum (MTPA). The company is in the process of setting up a cement grinding plant at Kalinganagar, Odisha.
JSW Cement has not put in any bid for the Emami unit. Parth Jindal, MD, JSW Cement, told The Hindu , “We are not interested in Emami Cement as we are looking to grow organically to reach target capacity of 20 MTPA.”
