UltraTech Acquires N Srinivasan's India Cements At Rs 3,954 Crore, No Change In The IPL Team Chennai Super Kings Ownership

The Aditya Birla Group owned UltraTech Cements – India’s largest cement manufacturer by market capitalisation as well as sales, on Sunday (July 28) announced the purchase of a 32.72 percent promoter’s equity stake in India Cements.

The cement major’s recent buy comes on the back of the purchase of a 23 percent equity stake in the company at Rs 1,885 crore in June, making UltraTech now the major stake owner and thus a controlling entity of the Tamil Nadu-based cement company.

"We are excited with the purchase of stake in India Cements as it enables UltraTech to serve the Southern markets more effectively and also accelerates our path to 200+ metric tonne per annum capacity," Kumar Mangalam Birla, Chairman of the Aditya Birla Group said.

This additional purchase of stake by the Aditya Birla Group Company in India Cements has also triggered a mandatory open offer. As per regulatory filing at the exchanges, UltraTech has offered a price of Rs 390 per share to the existing shareholders of the India Cements.

The sale of promoter’s stake by India Cements includes the equity owned by its Managing Director N Srinivasan, who along with his family also owns the Indian Premier League (IPL) cricket team Chennai Super Kings.

This is being considered as the influential business magnet's exit from the cement industry. The company was founded by Srinivasan’s father T S Narayanaswami along with S N N Sankaralinga Iyer in 1946, making it the oldest operating cement maker in Southern India.

At present, India Cements ranks ninth as per market capitalisation among the domestic cement companies. The company operates eight manufacturing units in Telangana, Andhra Pradesh, Tamil Nadu and Rajasthan.

The purchase of India Cements by UltraTech not only embolden's the latter's leadership position among the domestic cement makers, but also indicates that the Indian cement industry is headed now for a duopoly.

At present, among the top ten domestic cement makers by market capitalisation, while the Aditya Birla Group owns UltraTech along with Kesoram and India Cements now; Adani Group on the other hand owns Ambuja Cements – ranking second in terms of market capitalisation, along with ACC Cements and Sanghi Industries.

Chennai Super Kings Ownership Unaffected

As per a report by Cricbuzz, the acquisition of the cements company by UltraTech will not affect the Srinivasan and family’s ownership of the cricket team.

In a statement given to the sport news platform, the IPL team’s Chief Executive Officer Kashi Vishwanathan said that the cricket team was owned by a separate company named Chennai Super Kings Limited. He reportedly also said that Srinivasan along with his wife Chitra Srinivasan and daughter Rupa Gurunath hold a controlling stake in the company.