The Adani Group is reported to have received capital markets regulator SEBI’s nod for the $3.8-billion open offer for Ambuja Cements and ACC.
The Adani Group has made offers of INR 385 per share for Ambuja Cements and INR 2,300 a share for ACC.
With an investment of approximately INR 31,139 crore, together these two open offers might constitute the biggest open offer in corporate Indian history.
According to a notice, Endeavour Trade and Investment, a Mauritius-based entity owned by the Adani family, will invest INR 19,880 crore to buy 26% or 51.63 crore shares of Ambuja Cements from the public at INR 385 a piece.
Similarly, the Adani family offered to buy 26% (4.89 crore shares) of ACC from the public at a price of INR 2,300 per share for INR 11,259 crore (assuming full acceptance).
Post a successful open offer, Adani’s stake in Ambuja would rise to 89.11% and in ACC to 80.53%.
According to Indian stock market rules, acquiring 25% or more of the shares in a local listed company will trigger a mandatory open offer where minority shareholders can choose to sell their stakes to the new investor at a predetermined price.
Adani’s open offer price for Ambuja is at 6% discount compared to Thursday’s closing price while that for ACC is at a 1% discount, according to data compiled by Bloomberg.
ICICI Securities Ltd and Deutsche Bank AG are advising the Adani Group on the open offer. The deal was also cleared by the Competition Commission of India (CCI) last week.
The Holcim transaction is set to propel the Adani Group to become India’s second-largest cement producer virtually overnight in what’s an extremely fragmented and competitive market.
In May, Holcim agreed to sell its 63% stake in Mumbai-listed Ambuja Cements to Adani Group, which said then that it plans to spend about $10.5 billion on the stake purchases and open offer consideration for Ambuja and related entities.
As part of the deal, Adani will inherit Ambuja’s controlling stake in another publicly traded cement producer, ACC, and will buy Holcim’s direct 4.5% holding in the unit.
