The Hindu Business Line : Irish co CRH picks 50% in AP cement firm for $456 m

Hyderabad, March 20 The Dublin-based $20-billion CRH Group has entered India by picking up a 50 per cent stake in the Hyderabad-based privately held My Home Industries Ltd (MHIL), for a consideration of $456 million.

According to an agreement reached between the two companies, CRH, the Irish building materials major will take 42 per cent of the promoter’s stake for about Rs 1,337 crore, while investing Rs 500 crore into MHIL for the remaining 8 per cent.

Mr J. Rameshwara Rao, Chairman and Managing Director, MHIL, said a new 50:50 joint venture, to be called MHIL, would be formed by the partners to beef up the company’s capacities and make it a national player.

The MHIL has 3.2 million tonnes (mt) capacity in its three operational cement plants at Mylacheruvu in Nalgonda district of Andhra Pradesh. It also has a one-mt slag cement grinding unit near Visakhapatnam, which will be commissioned in October.

The joint venture plans to add about three mt capacity through greenfield projects in Dachepally, Guntur district. Already mine lease and land has been acquired, Mr Rao told Business Line.

It would also look at new acquisitions. The Rs 1,500 crore required for the expansion plan would involve raising funds through internal accruals and debt.

Mr Rao said the total enterprise value of the company was put at Rs 3,300 crore. While the CRH investment of Rs 500 crore in MHIL for 8 per cent stake would be through the issue of equity shares, the modalities for the promoters’ stake were being worked out. The final deal would be concluded in the next couple of months.

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