CCI approves Dalmia Cement’s acquisition

The Competition Commission of India (CCI) has approved Dalmia Cement's acquisition of Jaiprakash Associates Limited's cement, clinker, and power facilities for a 56,660 million transaction (JAL). With its headquarters in New Delhi, Dalmia Cement will be able to expand its position in central India thanks to the acquisition and turn into a pan-Indian enterprise with a capacity of 75 million tonnes by FY27 and 110-130 million tonnes by FY31. More than 50% of the cement production capacity of the Jaypee Group is located in Central India. Jaiprakash Associates will end its involvement in the cement sector as soon as all relevant regulatory organisations have given their consent to this most recent deal. Dalmia Cements is a completely owned subsidiary of Dalmia Bharat Limited (DBL), a company with more than 80 years of experience in the production and sale of cement. The DBL is ultimately in charge of the Dalmia Bharat Group. In addition to producing and selling clinker in India, JAL also manufactures and markets grey cement, mostly in the states of Madhya Pradesh, Uttar Pradesh, and Chhattisgarh, and produces thermal power in India, primarily for internal consumption. Uttar Pradesh, Chhattisgarh, and Madhya Pradesh are the locations of the plants being sold under this arrangement. Dalmia Bharat and Dalmia Cement signed a legally binding framework agreement to buy the companies in December of last year for an estimated 56,660 million. Cement, clinker, and power plants with a total capacity of 9.4 mtpa for cement, 6.7 mtpa for clinker, and 280 MW for thermal power plants were sold as part of the agreement. JAL has decided to completely give up on the cement industry, use the proceeds to pay back the lenders' loans, and concentrate on its other core business operations. REDUCING DEBT In the previous ten years, JAL had been actively working to reduce its debt, pay back its lenders, and fulfil its obligations. It sold UltraTech Cement Ltd over 20 mtpa of cement production capacity in 2014 and 2017 as well as the controlling stake in more than 2 mtpa of cement production to Dalmia Group in 2015. In order to reduce its debt, the company has previously sold its various cement and power plants to other leading industrial conglomerates. In order to pay off debt, JAL and Jaiprakash Power Ventures originally announced their plans to sell off their non-core businesses and cement company in October of last year.