Investors' response to the open bid made by the Adani Group for ACC and Ambuja Cements is unenthusiastic
The Adani Group made an open bid at Rs 2,300 per share for ACC and Rs 385 per share for Ambuja Cements Ltd. in May as a result of its agreement to pay USD 10.5 billion for a controlling position in Holcim's Indian companies.
admin
The Rs 31,000 crore open offer by Adani Group to buy 26% more shares of Swiss company Holcim's two Indian listed companies, ACC Ltd. and Ambuja Cements, closed on Friday despite lukewarm support from the general public. In accordance with the most recent regulatory filing by ACC Ltd, only 8.28 per cent of the original offer of 4.89 crore equity shares—or about 40.51 lakh equity shares—had been tendered as of Friday at 6.40 p.m.
Similar to this, only 1.35 percent of shares of Ambuja Cements were tendered. Compared to the initial offer for 51.63 crore shares from the public shareholders, only 6.97 lakh shares of Ambuja Cements have been presented in the escrow demat account, according to the most recent regulatory data on Saturday morning. On August 26, 2022, the bid for both companies became available.
The Adani Group made an open bid at Rs 2,300 per share for ACC and Rs 385 per share for Ambuja Cements Ltd. in May as a result of its agreement to pay USD 10.5 billion for a controlling position in Holcim's Indian companies. If fully subscribed, the open offer was projected to be worth more than Rs 31,000 crore.
However, when the open offer expired on Friday, shares of ACC Ltd settled on the BSE at Rs 2,365, 2.82 percent more than the offer price. Ambuja Cements' BSE settlement price, which is 17.89% higher than the offer price, was Rs 453.90. Ambuja Cements traded at a new 52-week high of Rs 484.70 a share on Friday, the final day of the open offer, while ACC recorded a surge in volume of more than 2.13 times.
Endeavour Trade and Investment, a Mauritius-based company owned by the Adani family group, started the letter of offer for the open bid. Acropolis Trade and Investment Ltd., owned by several Adani family members, promotes Endeavour Trade and Investment.
On May 15, the Adani Group announced a plan to enter the cement industry by acquiring a majority stake in Holcim Ltd's operations in India for USD 10.5 billion (about Rs 83,920 crore at current exchange rates). Adani Group will purchase associated assets and 63.1% of Ambuja Cements. ACC Ltd, one of Ambuja's local subsidiaries, is also listed on a stock exchange.
Through its subsidiaries, the leading Swiss manufacturer of construction materials Holcim owns 63.19 percent of Ambuja Cements and 54.53 percent of ACC (of which 50.05 per cent is held through Ambuja Cements). The installed production capacity of Ambuja Cements and ACC is now 70 million tonnes annually. The combined assets of the two businesses in India include 23 cement facilities, 14 grinding stations, 80 ready-mix concrete plants, and more than 50,000 channel partners.
