The shares of Amuja Cements fell 13 per cent at Rs 166.45 on the National Stock exchange, while ACC where Holcim has also announced a restructuring initiative cracked 4.3 per cent.
On Wednesday Holcim said that through intragroup restructuring, Holcim will increase its shareholding in Ambuja Cements to 61.39% and Ambuja in turn will acquire Holcim's 50.01% stake in ACC Ltd. . Both Ambuja and ACC will continue to operate as separate entities with their own brands and go-to-market strategies. However, the restructuring will allow for closer back-end cooperation between the companies as well as simplify the group structure.
"The Board of Ambuja and Holcim have agreed that the transaction will be effected through a merger of Holcim India Private Ltd. ("HIPL"), a wholly owned financial holding subsidiary, with Ambuja. HIPL currently directly holds a 9.76% stake in Ambuja and a 50.01% stake in ACC. In a two stage deal, Ambuja will first acquire, through a purchase, a 24% stake in HIPL for a cash consideration of INR 35,000 million (USD ~600 million), followed by a stock merger between HIPL and Ambuja. As part of the merger, Holcim will receive 584 million new equity shares of Ambuja resulting in an increase of its ownership in Ambuja from the current 50.55% to 61.39%," the company said in a release.
The transaction is subject to Ambuja's shareholder and regulatory approvals in India.