Ambuja Cements Merges ACC and Orient, Creating Bigger Platform for Investors

Ambuja Cements has approved a plan to bring ACC and Orient Cement into its fold, creating a single, larger cement business under the Adani Group.

How the merger is structured

Both ACC and Orient will become part of Ambuja through share‑swap deals – no cash will change hands. For every 100 ACC shares you own, you will receive 328 Ambuja shares (face value Rs 2). For every 100 Orient shares, you will receive 33 Ambuja shares.

At today’s market prices, the swap values ACC almost exactly at its current share price, while Orient gets about a 9% premium.

What it means for Ambuja shareholders

• Ambuja will issue roughly 326 million new shares, increasing its total shares from about 2.47 billion to around 2.78 billion – a dilution of 12‑13%.
• Even with dilution, earnings per share (EPS) are expected to rise because ACC trades at a lower valuation than Ambuja.
• Analysts project EPS to grow from roughly ₹16.9 to ₹18.6 in FY25 after the merger.

What ACC shareholders receive

The swap price is almost identical to ACC’s market price, so there is no immediate gain or loss. However, ACC shareholders will now hold shares in a larger, pan‑India cement platform that carries higher growth potential and better margins.

What Orient shareholders receive

Orient minority shareholders get a small premium – about 9% above the last trading price – and move into a much bigger, diversified cement group.

Strategic reasons behind the deal

The Adani Group has been consolidating its cement assets for the past two years. By merging these companies, it aims to:

• Streamline operations and cut overlapping costs, targeting at least ₹100 per tonne improvement in margins.
• Expand total cement capacity from roughly 107 million tonnes per year to 155 million tonnes by FY28.
• Create a stronger brand presence across all regions of India.

Future outlook and risks

The merger needs regulatory and shareholder approvals and is expected to be effective in early 2026. Key risks include possible delays in approvals, challenges of integrating plants and staff, and meeting the promised cost‑saving targets.

Disclaimer

Remember, this is my interpretation of the facts, not a prediction. Do your own research and consider your risk tolerance before making any investment decisions.