Adani Group firm Ambuja Cements Ltd on Tuesday (December 17) announced the amalgamation of its subsidiaries, Sanghi Industries Ltd (SIL) and Penna Cement Industries Ltd (PCIL), with the parent company.

The announcement follows the introduction of separate schemes of arrangement for both subsidiaries, paving the way for their integration into Ambuja Cements.

Sanghi Industries has a clinker capacity of 6.6 MTPA, a cement capacity of 6.1 MTPA, and limestone reserves of one billion tonnes. Sanghi Industries' Sanghipuram plant is India's largest single-location cement and clinker unit by capacity, with a captive jetty and captive power plant.

Penna has four integrated plants in Andhra Pradesh and Telangana, along with a grinding unit in Maharashtra. It has an operational capacity of 10 MTPA. Additionally, two plants, with a capacity of 2 MTPA each, are under construction in Krishnapatnam and Jodhpur, expected to be completed within the next 8-12 months. It also has five bulk cement terminals in Kolkata, Gopalpur, Karaikal, Kochi, and Colombo (Sri Lanka).

Ambuja Cements will issue 12 equity shares of the face value of ₹2 each for every 100 equity shares of SIL of face value ₹10 each as recommended by the valuers and accepted by the board. Thereby, the eligible shareholders of SIL will become the shareholders of Ambuja Cements.

These transactions will be effected with requisite approvals from related stakeholders and authorities, anticipated to be completed within 9-12 months’ time.

Ajay Kapur, CEO of Cement Business, Adani Group, said, "This merger aims to make our company more competitive and efficient, ultimately enhancing shareholder value. Enhanced working capital management and internal funds will support the growth of our business operations.”

“Unified cash flow management will pool resources for faster expansion and cost savings in administration and governance, thereby simplifying compliance requirements. This advancement through a larger entity will increase market competitiveness and deliver greater value to our shareholders," he added.

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