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Mumbai, April 12

SWISS cement maker, Holcim Ltd, failed to get the controlling stake in Associated Cement Companies (ACC). Holcim's open offer made through its Indian holding company Ambuja Cement India Ltd (ACIL), could get only an additional 20.8 per cent stake in ACC, taking its total stake to 34.6 per cent, as against its plan to have 50.01 per cent.

Holcim hold 67 per cent stake in ACIL while Gujarat Ambuja Cements Ltd (GACL) holds the remaining 33 per cent.

ACC Ltd shares closed at Rs 362.55 a share (Rs 356.90) on the Stock Exchange, Mumbai on Tuesday, a day after the open offer closed.

According to analysts, the Rs 370 a share open offer price was not significantly higher than the market price, and so did not make sense for investors to offer shares.

We expect the company to continue raising its stake in ACC through a creeping acquisition, said a senior analyst at an Indian broking house. She said the 34.6 per cent stake acquired by ACC was large enough to influence board decisions.

Holcim said on January 20, 2005 that it would spend $800 million to acquire stakes in ACC and two units of Gujarat Ambuja Cements Ltd to expand its presence in India, where demand for cement is increasing at a faster pace than in Europe and North America.

(This article was published in the Business Line print edition dated April 13, 2005)
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