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As many as six entities, including leading private equity players and cement majors, have bid for Reliance Infrastructure’s 5.6-million-tonne capacity cement assets. The Anil Ambani group company expects to rake in over ₹5,000 crore from the sales.
The bidders include PE players Carlyle Group, The Blackstone Group, Baring Private Equity and cement majors JK Lakshmi and JSW Cement. CRC of China has also thrown its hat in the ring, top investment banking sources close to the Reliance Group told BusinessLine .
The companies have concluded the due diligence process and binding bids are expected to be placed by December 24, the sources said, declining to be identified before a formal announcement.
While some of the bidders could not be immediately contacted for a comment, JSW Cement, Carlyle Group and Blackstone declined to comment.
Morgan Stanley and State Bank of India are the lead bankers for the deal, another source privy to the development said.
Reliance Infrastructure is looking to sell its cement business and related assets and roads businesses to focus on its new defence venture.
On November 5, Reliance Infra said in a regulatory filing that it had short-listed seven out of 15 potential bidders who had submitted expressions of interest for its cement business. It did not disclose the names of the bidders.
Reliance Infra hopes to complete the sale of its cement business by the end of this financial year.
The cement industry is going through a consolidation with some manufacturers unable to sustain business owing to a poor pick-up in demand. In April, Shree Cement completed the acquisition of a cement grinding unit of Jaiprakash Associates for ₹358.22 crore.
In August, Birla Corp agreed to buy two cement units of Lafarge SA’s local arm for an enterprise value of ₹5,000 crore. The plants in Chhattisgarh and Jharkhand, with a combined production capacity of around 5.15 million tonnes, were put up for sale after Holcim of Switzerland and France-based Lafarge agreed this year to a global merger.
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