The Amravati bench of the National Company Law Tribunal (NCLT) has authorised a bid of Sagar Cements to acquire Andhra Cements for Rs 9.22 billion; the Jaypee Group cement maker now facing insolvency procedures would continue to be listed on the bourses.
On February 16, the Sagar Cements board of directors authorised a plan to roughly quadruple Andhra Cements' capacity to 3 million tonne per year, at a cost of Rs 4.68 billion.
Sagar Cements intends to raise Rs 6.22 billion in loan and Rs 3.22 billion in equity of the proposed acquisition cost of Rs 9.22 billion.
The acquisition gives Sagar Cements a 95 percent share in Andhra Cements, with the public owning the remaining 5%.
Clarifying that Andhra Cements will stay listed, Sagar Cements stated that it will lower its holding to 90% within 12 months and to 75% within 36 months from the date of NCLT clearance.
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