JK Cement, led by Nidhipati Singhania, has successfully acquired a 100% stake in Toshali Cement, according to a statement released by the Company on the stock exchange. JK Cement is one of India's top 8 cement manufacturers as they have a capacity of 20 million tonnes per annum.
With the acquisition of Odisha-based Toshali Cement, the Company will add a further 0.6 million tonnes per annum of cement capacity. The total acquisition cost is Rs. 90 crore, not including the price of a limestone mining license, which is also part of the deal. After transferring the mining license, JK Cement will make an additional payment of Rs. 67 crore.
“Upon this acquisition, Toshali has immediately become a wholly owned subsidiary of the Company. The transfer of the Mining Lease is subject to necessary statutory and regulatory approvals, which is likely to be completed within 18 months hereof”, JK Cement said in the exchange filing.
Toshali Cement operates two manufacturing units in Odisha. The first one, located in Koraput district, has added units with a clinker capacity of 0.33 million tonnes per annum and a grinding capacity of 0.2 million tonnes per annum. The second unit in Cuttak district is a grinding unit with a cement production capacity of 0.44 million tonnes per annum.
According to a recent webinar by CareEdge Ratings, the country's top cement manufacturers plan to increase their capacity due to expected demand increases from major government initiatives, such as large road construction programs and housing schemes for low-income people.
