Dalmia Bharat has announced the acquisition of cement assets from debt-ridden Jaiprakash Associates for ₹2,850 crore, as reported by Business Standard. The transaction involves cement plants at Rewa (Madhya Pradesh), Churk, Chunar and Sadwa (Uttar Pradesh) with 5.2 MTPA cement capacity and 3.3 MTPA clinker capacity. The Business Transfer Agreement has been executed by Dalmia Cement (Bharat) Ltd (DCBL), a wholly-owned subsidiary of Dalmia Bharat, with completion expected within two weeks. Following the takeover, Dalmia Bharat's cement capacity will increase to 54.7 million tonne per annum (MTPA).
The acquisition provides strategic fit and market diversification, reducing regional volatility for Dalmia Bharat. The deal includes 99 MW of thermal power capacity with railway siding, enhancing the company's integrated operations. Managing Director & CEO Puneet Dalmia noted that familiarity with these assets under previous tolling arrangements will help establish strong connections with channel partners and vendors for faster capacity ramp-up. The company believes this understanding will facilitate quicker market inroads and accelerated capacity expansion.
Dalmia Bharat will fund the acquisition through a mix of debt and internal accruals, as reported by Business Standard. The company has ongoing expansion projects at Belgaum, Pune and Kadapa that will further augment cement capacity to 66.7 MTPA by Q2-Q3 FY28. These agreements were originally entered into in December 2022 with JAL before insolvency proceedings began, with DCBL requesting that earlier agreements be considered post-resolution plan approval.
The Corporate Insolvency Resolution Process against Jaiprakash Associates was initiated on June 3, 2024 after the Allahabad bench of NCLT admitted a petition by ICICI Bank. Adani Enterprises subsequently approved a ₹14,535 crore resolution plan to take over the bankrupt flagship firm. While the original sale agreement was pending, JAL was admitted to insolvency and the transaction could not be completed. The resolution plan approval enabled DCBL to request consideration of the earlier framework agreement to settle pending disputes with JAL, including under the 'long-term clinker supply agreement'.
