Mumbai: Portuguese cement maker Cimpor Cimentos de Portugal SGPS SA has bought a controlling 73.63 per cent stake in Shree Digvijay Cement Company for a total of about 70 million euros (approximately Rs4412.8 / $110.5 millio).
Under a deal, concluded late last year, Cimpor had acquired 53.6 per cent of Shree Digvijay from Grasim Industries. Cimpor made a mandatory public offer for additional 20 per cent earlier this month, taking the total stake to 73. 63 per cent.
The acquisition gives Cimpor access to the world's second largest cement market and boosts its worldwide cement production capacity to 29.5 million tonnes per year, the company said in a statement.
Cimpor is now among the world's top 10 cement makers, it said.
Late last year, Cimpor had bought 53.63 per cent of Shree Digvijay's equity capital from Grasim Industries at Rs42.5 a share, valuing the company at Rs674 crore (117 million euros).
Grasim Industries Ltd, flagship of the Aditya Birla Group, offloaded its entire stake in Shree Digvijay Cement to Cimpor through its subsidiary, Cimpor Inversiones S.A. at a consideration of Rs322 crore.
Grasim acquired SDCC in 1998 to gain a presence in the Gujarat market. Grasim subsequently acquired UltraTech Cement in 2004, thereby adding a further 6 million tonnes capacity in Gujarat.
The Aditya Birla Group is currently installing additional capacity at both Grasim and its subsidiary, UltraTech Cement Limited.
Grasim's current cement capacity of 31 million tonnes per annum will move up to 45 million tpa by Q2 FY09, even after the disposal of SDCC stake.
Shree Digvijay Cement Company, located at Digvijaygram in Gujarat, has a capacity of 1.07 million tonnes per annum.
For the year ended 31 March 2007, SDCC reported a turnover of Rs2.6 billion and net profit of Rs54 crore.
Cimpor is the biggest Portuguese cement company, with presence in 11 different countries - Portugal, Spain, Morocco, Tunisia, Egypt, Brazil, South Africa, Mozambique, Cape Verde, Turkey and China. Cimpor is listed on the Lisbon Stock Exchange.