An investment banker and a company official said that UltraTech Cement Ltd and a subsidiary of Aditya Birla group will purchase around 80% stake in Dubai’s ETA Star group owned Star Cement Co Llc for an enterprise value of USD 380 million.
The purchase will be made through UltraTech Cement Middle East Investments Ltd a wholly owned subsidiary of UltraTech Cement.
Enterprise value is the market value of the entire business including debt.
Mr Adesh Gupta a whole time director and CFO at Grasim Industries Ltd which controls 60% in UltraTech Cement said that “It will be more than 51% stake it will be very high stake. It will give an exit route for ETA group.”
Mr Gupta said the deal will give the USD 30 billion Birla group direct access to the West Asian market until now served through exports. He said that “We used to export more than 0.3 million tonnes of clinker to the UAE market. So instead of exporting clinker from India we have our own plant.”
The reports added that the remaining stake in Star Cement will be held by the local partner with whom ETA had built cement plants. The acquisition is set for completion later this week.
Source: Steel Guru