India's Sanghi Industries hits 5-yr high on report Adani-owned Ambuja to buy stake

Sanghi Industries

02/08/2023 06:16

BENGALURU, Aug 2 (Reuters) - Shares of cement maker
Sanghi Industries  SNGI.NS  rose as much as 5% to a more than
five-year high on Wednesday on news that Adani-owned Ambuja
Cements  ABUJ.NS  had reached a deal to buy a majority stake in
the company's operations.
    The deal by Ambuja is likely to be announced on Wednesday,
two sources with direct knowledge of the matter told Reuters. 
    The deal was signed by considering Sanghi's enterprise value
at 60 billion rupees ($728.20 million), one of the sources said.
    Sanghi's stock is up nearly 40% so far in the second half of
the calendar year. The Economic Times reported last week that
Adani was among those leading the race to acquire Sanghi Cement.
    Sanghi is one of the leading cement manufacturers from the
western Indian state of Gujarat. It has a production capacity of
6.1 million metric tons per annum, according to its website.
    The deal could add heft to the cement operations of
billionaire Gautam Adani's firm. Adani is India's second-largest
cement producer, behind UltraTech Cement  ULTC.NS . 
    It owns Ambuja and its subsidiary ACC  ACC.NS  that have a
combined capacity to produce more than 65 million metric tons
with more than a dozen manufacturing plants across India.
    Ambuja Cements shares fell nearly 2% in early trading,
before paring some losses. 
        The company on Wednesday also 
    posted
     a 29% jump in June-quarter profit, excluding dividend
income, helped by strong demand for its premium cement products
and lower costs.
  

($1 = 82.3950 Indian rupees)

 (Reporting by Kashish Tandon in Bengaluru; Editing by Sohini
Goswami)
 ((Kashish.Tandon@thomsonreuters.com;))