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Cement major ACC set aside investors’ apprehension over the global merger of Lafarge with Holcim and its likely impact on minority shareholders in India.
At the 78th Annual General Meeting of ACC here on Wednesday, shareholders insisted that the independent directors should ensure that minority shareholders are not short-changed if the global major decides to merge Lafarge India with Ambuja Cements or ACC.
Responding to queries on the merger in India, ACC Chairman NS Sekhsaria reassured investors that Holcim always believes in providing right value for minority shareholders.
“Though it is too early to come to any conclusion on merger in India, I have found that Holcim does everything in a transparent manner and would never do anything that is unfair for minority shareholders,” he said.
Drawing a lead from how Holcim agreed to hold the technical know-how fee at the last year’s level of one per cent despite having an option to increase it progressively every year, Sekhsari said the fee charged by Holcim is one of the lowest as other cement companies charge 2-5 per cent (of sales) annually.
“Holcim had also requested higher fees but independent directors on the Board said that anything above one per cent would not be appropriate and they have agreed. This was despite the majority of investors in the company voting in favour of that resolution,” he said.
Sekhsaria also assured investors that ACC will remain an independent brand even if Holcim and Lafarge decide to merger their entity in India.
Speaking on the sidelines of the meeting, Holcim nominee on ACC board Aidan Lynam said the merger would take about 12-18 weeks to complete and the decision on the Indian operations would be finalised during this process.
There is no major overlap of Holcim and Lafarge operations in India, expect a few regions in the eastern States.
Kuldip Kaura, Managing Director, ACC, said the cement industry registered a nominal growth of just one per cent last year due to the economic slowdown.
The industry capacity utilisation was down at 69 per cent against 74 per cent in 2012.
ACC recorded capacity utilisation of 78 per cent, well above the industry average.
It has managed to save ₹165 crore last year by targeted programmes to bring down cost of logistics, power and fuel.
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