Kolkata-based Emami Group on Thursday said that it has entered into a binding agreement with Nuvoco Vistas Corporation, part of Nirma Group, to sell 100% equity stake in Emami Cement for an enterprise value of ₹5,500 crore.
Emami Cement operates one integrated cement plant and three grinding units—with a total capacity of around 8.3 million tonnes per annum (mtpa).
“This transaction is an important step in our group’s stated objective of becoming debt-free and with this transaction, we will substantially achieve this objective,” said Manish Goenka, director, Emami Group. “We strongly believe in Nuvoco. We have found the right acquirer who will be able to develop the business further in the interest of all the stakeholders.”
The transaction is subject to the customary approvals, including from the Competition Commission, and is expected to be consummated in the next three-four months.
“It (Emami Cement) has successfully established a very strong brand equity in the market for its highest standards of operation and high-quality products, helping us to get a good value. We strongly believe that the Nuvoco and Nirma Group will continue from here and strengthen the business further,” said Aditya Agarwal, director, Emami Group.
Shardul Amarchand Mangaldas acted as the legal advisor, Deloitte Touche Tohamatsu India LLP acted as the financial diligence advisor, and Arpwood Capital acted as the financial advisor.
Nuvoco Vistas, a Nirma Group company, is a manufacturer and retailer of building materials and is one of the major players in the cement industry in the eastern, central and northern regions of India, with an installed capacity of around 14 mtpa.