Nuvoco Vistas Corporation has become India’s fifth largest cement company after getting final approval from the National Company Law Tribunal (NCLT) to acquire Vadraj Cement. The total acquisition cost is ₹1,800 crore. The approval was granted by the NCLT’s Mumbai bench and made public on April 3.
The acquisition will be carried out through Vanya Corporation, a fully owned subsidiary of Nuvoco. Later, Vanya will merge with Vadraj Cement, making Vadraj a 100 percent subsidiary of Nuvoco. With this move, Nuvoco, which is part of the Nirma Group, is set to increase its market share in the cement and building materials sector.
This acquisition will increase Nuvoco’s capacity to produce cement to a total of 31 million tonnes per year (MTPA) and clinker capacity to 17 MTPA by the end of the third quarter in FY27. It will increase the company’s base in the western part of India, particularly Gujarat and Maharashtra, with the company becoming the third largest capacity player in the region.
Nuvoco had previously labeled the acquisition of Vadraj as a growth opportunity at a low cost of approximately $60 a tonne. This is lower than the cost of some other recent cement industry deals. Nuvoco will also invest a further ₹900 crore to ₹1,200 crore in the next 18-24 months in increasing the operations of Vadraj.
Originally a Lafarge India startup in 1999, Nuvoco was renamed when the Nirma Group acquired the business in 2016. Nuvoco is targeting quicker growth and increased foothold in the Indian cement industry with the Vadraj Cement acquisition.
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Source: Moneycontrol.
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