An

Assignment
On

Mergers & Acquisition (M&A)

Submitted for

MBA II Semester (2021-2022)

Subject: Seminars on Contemporary Issues

Subject Code:M-207

Submitted by: Submitted to:

Shaan Mahendra Dr. Vijay Mohan

MBA II semester Assistant Professor

Department of Management
Engineering College Bikaner (ECB)
Bikaner
 Content
Page No.
1. Mergers Vs. Acquisition: An Overview 1
2. Types of Mergers and Acquisition 2
3. Frequently Asked Questions about M&A 4

4. Mergers and Acquisitions Benefits 6

5. Acquisition of Ambuja Cement and ACC Ltd.
by Adani Group
8
6. ACC Ltd.
12
7. Adani Cement
17
Mergers vs. Acquisitions: An Overview

Mergers and acquisitions are two of the most misunderstood words in the business
world. Both terms often refer to the joining of two companies, but there are key
differences involved in when to use them.

A merger occurs when two separate entities combine forces to create a new, joint
organization. Meanwhile, an acquisition refers to the takeover of one entity by
another. Mergers and acquisitions may be completed to expand a company’s reach
or gain market share in an attempt to create shareholder value.

Mergers

Legally speaking, a merger requires two companies to consolidate into a new

entity with a new ownership and management structure (ostensibly with members of
each firm). The more common distinction to differentiating a deal is whether the
purchase is friendly (merger) or hostile (acquisition). Mergers require no cash to
complete but dilute each company's individual power.

In practice, friendly mergers of equals do not take place very frequently. It's
uncommon that two companies would benefit from combining forces with two
different CEOs agreeing to give up some authority to realize those benefits. When
this does happen, the stocks of both companies are surrendered, and new stocks
are issued under the name of the new business identity.

Typically, mergers are done to reduce operational costs, expand into new markets,
boost revenue and profits. Mergers are usually voluntary and involve companies
that are roughly the same size and scope.

Acquisitions

In an acquisition, a new company does not emerge. Instead, the smaller company is
often consumed and ceases to exist with its assets becoming part of the larger
company.

Acquisitions, sometimes called takeovers, generally carry a more negative

connotation than mergers. As a result, acquiring companies may refer to an
acquisition as a merger even though it's clearly a takeover. An acquisition takes
place when one company takes over all of the operational management decisions of
another company. Acquisitions require large amounts of cash, but the buyer's power
is absolute.

Companies may acquire another company to purchase their supplier and improve
economies of scale–which lowers the costs per unit as production increases.
Companies might look to improve their market share, reduce costs, and expand into
new product lines. Companies engage in acquisitions to obtain the technologies of
the target company, which can help save years of capital investment costs and
research and development.

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Since mergers are so uncommon and takeovers are viewed in a negative light, the
two terms have become increasingly blended and used in conjunction with one
another. Contemporary corporate restructurings are usually referred to as merger
and acquisition (M&A) transactions rather than simply a merger or acquisition. The
practical differences between the two terms are slowly being eroded by the new
definition of M&A deals.

Types of Mergers and Acquisitions

The following are some common transactions that fall under the M&A umbrella.

Mergers
In a merger, the boards of directors for two companies approve the combination and
seek shareholders' approval. For example, in 1998, a merger deal occurred
between the Digital Equipment Corporation and Compaq, whereby Compaq
absorbed the Digital Equipment Corporation. Compaq later merged with Hewlett-
Packard in 2002. Compaq's pre-merger ticker symbol was CPQ. This was combined
with Hewlett-Packard's ticker symbol (HWP) to create the current ticker symbol
(HPQ).

Acquisitions
In a simple acquisition, the acquiring company obtains the majority stake in the
acquired firm, which does not change its name or alter its organizational structure.
An example of this type of transaction is Manulife Financial Corporation's 2004
acquisition of John Hancock Financial Services, wherein both companies preserved
their names and organizational structures.

Consolidations
Consolidation creates a new company by combining core businesses and
abandoning the old corporate structures. Stockholders of both companies must
approve the consolidation, and subsequent to the approval, receive
common equity shares in the new firm. For example, in 1998, Citicorp and Travelers
Insurance Group announced a consolidation, which resulted in Citigroup.

Tender Offers
In a tender offer, one company offers to purchase the outstanding stock of the other
firm at a specific price rather than the market price. The acquiring company
communicates the offer directly to the other company's shareholders, bypassing the
management and board of directors. For example, in 2008, Johnson & Johnson
made a tender offer to acquire Omrix Biopharmaceuticals for $438 million. The
company agreed to the tender offer and the deal was settled by the end of
December 2008.

Acquisition of Assets
In an acquisition of assets, one company directly acquires the assets of another
company. The company whose assets are being acquired must obtain approval
from its shareholders. The purchase of assets is typical
during bankruptcy proceedings, wherein other companies bid for various assets of
the bankrupt company, which is liquidated upon the final transfer of assets to the
acquiring firms.

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Management Acquisitions
In a management acquisition, also known as a management-led buyout (MBO), a
company's executives purchase a controlling stake in another company, taking it
private. These former executives often partner with a financier or former corporate
officers in an effort to help fund a transaction. Such M&A transactions are typically
financed disproportionately with debt, and the majority of shareholders must
approve it. For example, in 2013, Dell Corporation announced that it was acquired
by its founder, Michael Dell.

How Mergers Are Structured

Mergers can be structured in a number of different ways, based on the relationship

between the two companies involved in the deal:

• Horizontal merger: Two companies that are in direct competition and share
the same product lines and markets.
• Vertical merger: A customer and company or a supplier and company. Think
of an ice cream maker merging with a cone supplier.
• Congeneric mergers: Two businesses that serve the same consumer base
in different ways, such as a TV manufacturer and a cable company.
• Market-extension merger: Two companies that sell the same products in
different markets.
• Product-extension merger: Two companies selling different but related
products in the same market.
• Conglomeration: Two companies that have no common business areas.

Mergers may also be distinguished by following two financing methods, each with its
own ramifications for investors.

Purchase Mergers
As the name suggests, this kind of merger occurs when one company purchases
another company. The purchase is made with cash or through the issue of some
kind of debt instrument. The sale is taxable, which attracts the acquiring companies,
who enjoy the tax benefits. Acquired assets can be written up to the actual purchase
price, and the difference between the book value and the purchase price of the
assets can depreciate annually, reducing taxes payable by the acquiring company.

Consolidation Mergers
With this merger, a brand new company is formed, and both companies are bought
and combined under the new entity. The tax terms are the same as those of a
purchase merger.

How Acquisitions Are Financed

A company can buy another company with cash, stock, assumption of debt, or a
combination of some or all of the three. In smaller deals, it is also common for one
company to acquire all of another company's assets. Company X buys all of
Company Y's assets for cash, which means that Company Y will have only cash
(and debt, if any). Of course, Company Y becomes merely a shell and will
eventually liquidate or enter other areas of business.

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Another acquisition deal known as a reverse merger enables a private company to
become publicly listed in a relatively short time period. Reverse mergers occur when
a private company that has strong prospects and is eager to acquire financing buys
a publicly listed shell company with no legitimate business operations and limited
assets. The private company reverses merges into the public company, and
together they become an entirely new public corporation with tradable shares.

How Mergers and Acquisitions Are Valued

Both companies involved on either side of an M&A deal will value the target
company differently. The seller will obviously value the company at the highest price
possible, while the buyer will attempt to buy it for the lowest price possible.
Fortunately, a company can be objectively valued by studying comparable
companies in an industry, and by relying on the following metrics.

Price-to-Earnings Ratio (P/E Ratio)

With the use of a price-to-earnings ratio (P/E ratio), an acquiring company makes an
offer that is a multiple of the earnings of the target company. Examining the P/E for
all the stocks within the same industry group will give the acquiring company good
guidance for what the target's P/E multiple should be.

Enterprise-Value-to-Sales Ratio (EV/Sales)

With an enterprise-value-to-sales ratio (EV/sales), the acquiring company makes an
offer as a multiple of the revenues while being aware of the price-to-sales (P/S
ratio) of other companies in the industry.

Discounted Cash Flow (DCF)

A key valuation tool in M&A, a discounted cash flow (DFC) analysis determines a
company's current value, according to its estimated future cash flows.
Forecasted free cash flows (net income + depreciation/amortization (capital
expenditures) change in working capital) are discounted to a present value using
the company's weighted average cost of capital (WACC). Admittedly, DCF is tricky
to get right, but few tools can rival this valuation method.

Replacement Cost
In a few cases, acquisitions are based on the cost of replacing the target company.
For simplicity's sake, suppose the value of a company is simply the sum of all its
equipment and staffing costs. The acquiring company can literally order the target to
sell at that price, or it will create a competitor for the same cost.

Naturally, it takes a long time to assemble good management, acquire property, and
purchase the right equipment. This method of establishing a price certainly wouldn't
make much sense in a service industry wherein the key assets (people and ideas)
are hard to value and develop.

Frequently Asked Questions

How Do Mergers Differ From Acquisitions?

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In general, "acquisition" describes a transaction, wherein one firm absorbs another
firm via a takeover. The term "merger" is used when the purchasing and target
companies mutually combine to form a completely new entity. Because each
combination is a unique case with its own peculiarities and reasons for undertaking
the transaction, use of these terms tends to overlap.

Why Do Companies Keep Acquiring Other Companies Through M&A?

Two of the key drivers of capitalism are competition and growth. When a company
faces competition, it must both cut costs and innovate at the same time. One
solution is to acquire competitors so that they are no longer a threat. Companies
also complete M&A to grow by acquiring new product lines, intellectual property,
human capital, and customer bases. Companies may also look for synergies. By
combining business activities, overall performance efficiency tends to increase, and
across-the-board costs tend to drop as each company leverages off of the other
company's strengths.

What Is a Hostile Takeover?

Friendly acquisitions are most common and occur when the target firm agrees to be
acquired; its board of directors and shareholders approve of the acquisition, and
these combinations often work for the mutual benefit of the acquiring and target
companies.

Unfriendly acquisitions, commonly known as hostile takeovers, occur when the

target company does not consent to the acquisition.

Hostile acquisitions don't have the same agreement from the target firm, and so the
acquiring firm must actively purchase large stakes of the target company to gain a
controlling interest, which forces the acquisition.

How Does M&A Activity Affect Shareholders?

Generally speaking, in the days leading up to a merger or acquisition, shareholders

of the acquiring firm will see a temporary drop in share value. At the same time,
shares in the target firm typically experience a rise in value. This is often due to the
fact that the acquiring firm will need to spend capital to acquire the target firm at a
premium to the pre-takeover share prices.

After a merger or acquisition officially takes effect, the stock price usually exceeds
the value of each underlying company during its pre-takeover stage. In the absence
of unfavorable economic conditions, shareholders of the merged company usually
experience favorable long-term performance and dividends.

Note that the shareholders of both companies may experience a dilution of voting
power due to the increased number of shares released during the merger process.
This phenomenon is prominent in stock-for-stock mergers, when the new company
offers its shares in exchange for shares in the target company, at an agreed-
upon conversion rate. Shareholders of the acquiring company experience a
marginal loss of voting power, while shareholders of a smaller target company may

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see a significant erosion of their voting powers in the relatively larger pool of
stakeholders.

Mergers and Acquisitions Benefits

Here are the top ten mergers and acquisitions benefits that you should know.

1. Economies of Scale

Often, the end goal of a merger and acquisition is to realize economic gains and
economies of scale. This becomes possible when the two firms involved in the
merger and acquisition are stronger, more productive, and more efficient together
than apart. Businesses consolidate to reap benefits like increased access to capital,
better bargaining power in the market, lower costs resulting from high volume
production, and more.

2. Economies of Scope

Mergers and acquisitions benefits include economy of scope, which refers to the
reduction in production cost of one product due to the production of another related
product. In other words, one product supports another to reduce the overall costs.
Economies of scope typically occur when producing more products is more feasible
and economical than making a single or fewer products. Mergers and acquisitions
can sometimes lead to economies of scope that may be impossible to achieve
through organic growth.

3. Competitive Edge in the Market

Mergers and acquisitions mean greater financial strength for both companies
involved in the transaction. Having greater economic power can lead to higher
market share, more influence over customers, and reduced competitive threat. In
most cases, bigger companies are harder to compete against.

4. Access to the Best Talent

Talent acquisition is one of the biggest concerns for companies that wish to excel in
the market. The recruitment industry knows that talented employees are attracted to
big names. Consequently, the bigger the company, the better access it enjoys to the
best available talent. This trend is evident across industries from manufacturing to
technology and services.

5. Access to Resources

Businesses in the same sector can sometimes improve access to materials,

suppliers, and tangible resources through acquisition. For example, one business
may acquire or merge with one of its suppliers to improve production cycles and
guarantee access to critical materials.

6. Diversification of Risk through Portfolio Divergence

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Mergers and acquisitions allow companies to spread risk across different revenue
streams by the diversification of the products, services, and prospects for the
business. If one revenue stream falls short, the business will still have several other
income streams to fall back on and continue operation. By diversification of risk, the
company can ensure sustainability for the long run.

7. Cost-Effective Alternatives for Facilities

Mergers and acquisitions present a cost-effective alternative to starting from

scratch. Setting up production centers, buying machinery and equipment, building
storage places, and initiating distribution channels are costly. It is more cost-
effective to merge with another company already equipped with the facilities you
require. Furthermore, the transaction will also bring all the other merger and
acquisition benefits that will contribute to business success.

8. Access to New Markets

Breaking into a new market can be challenging, even for established businesses.
While setting up a subsidiary or branch is always an option, a merger or acquisition
can save companies a significant amount of time, effort, and money compared to
starting from scratch.

This is especially true for businesses ready to move into a foreign geographical
market. International markets can be exceedingly difficult to penetrate. Therefore, it
is more feasible for most companies to merge with or acquire an established local
business that already has a loyal customer base.

9. Opportunist Value Generation

Larger organizations are often on the lookout for acquisition opportunities where the
purchase price is valued at less than the fair market value of the target’s net assets.
Such financial positioning indicates that the target company is experiencing financial
distress. In such cases, a merger or acquisition can allow the acquired company to
stay afloat, and the acquiring company to reap benefits such as proprietary rights to
products, increased market growth, penetration in new geographic regions, and
more.

10. Enterprise Continuation

Some small businesses are family or privately owned. Once the founder retires,
there is a risk of business failure because there may not be a clear succession plan
for the business. This can put employees out of work and impact suppliers to the
business. A merger or acquisition is one strategy to help ensure business continuity,
reduce interruptions in the operation, and provide job security for employees.

The Bottom Line

Merger and acquisition benefits are clear. However, to sustain the positive benefits
of any acquisition or merger pursuit, businesses need to implement the
right mergers and acquisitions strategy crafted to meet the company’s unique

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circumstances and goals. It is also essential to ensure a successful post-merger
integration, which is fundamental to capturing synergies, profitable growth, and deal
valuation.

While mergers and acquisitions can be highly beneficial, working out the details can
be complicated. Contact Windes to learn more about mergers and acquisitions and
to explore your options.

Acquisition of Ambuja Cement and ACC Ltd. by Adani Group

Adani Group
Adani Group is an Indian multinational conglomerate, headquartered in Ahmedabad. It was
founded by Gautam Adani in 1988 as a commodity trading business, with the flagship
company Adani Enterprises. The Group's diverse businesses include port management,
electric power generation and transmission, renewable energy, mining, airport operations,
natural gas, food processing and infrastructure. Worldwide, Adani Group has over 100,000
total employees, both directly and indirectly.

In April 2021, Adani Group became the third Indian conglomerate to cross US$100 billion in
market capitalisation. It crossed the market capitalisation of US$200 billion in April 2022,
becoming the third Indian conglomerate after Tata Group and Reliance Industries to do so.
In November 2022, Adani Group market capitalization reached top $280 billion (INR 24
trillion) and market capital vision $1 trillion by 2029, surpassing Tata Group.
According to The Washington Post, more than 60 percent of the Adani Group's revenue is
derived from coal-related businesses.

History
Adani Exports Limited commenced as a commodity trading firm in 1988 and diversified into
the import and export of multi-basket commodities. With a capital of ₹5 lakhs, the company
was established as a partnership firm with the flagship company Adani Enterprises,
previously Adani Exports. In 1990 the Adani Group developed its own port in Mundra to
provide a base for its trading operations. It began construction at Mundra in 1995. In 1998,
it became the top net foreign exchange earner for India Inc. The company began coal
trading in 1999, followed by a joint venture in edible oil refining in 2000 with the formation
of Adani Wilmar.

The group's second phase started with the creation of large infrastructure assets. The
company established a portfolio of ports, power plants, mines, ships and railway lines inside
and outside India.

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Adani handled 4 Mt of cargo at Mundra in 2002, becoming the largest private port in India.
Later in 2006, the company became the largest coal importer in India with 11 Mt of coal
handling. The company expanded its business in 2008, purchasing Bunyu Mine in Indonesia
which has 180 Mt of coal reserves. In 2009 the firm began generating 330 MW of thermal
power. It also built an edible oil refining capacity in India of 2.2 Mt per annum. Adani
Enterprises became the largest trading house in India importing coal with a market share
60%. It also supplies coal to NTPC, India. The Adani group became India's largest private coal
mining company after Adani Enterprises won the Orissa mine rights in 2010. Operations at
the Port of Dahej commenced in 2011 and its capacity subsequently grew to 20 Mt. The
company also bought Galilee Basin mine in Australia with 10.4 gigatonnes (Gt) of coal
reserves. It also commissioned 60 Mt of handling capacity for the coal import terminal in
Mundra, making it the world's largest. In the same year, the Adani group also bought Abbot
Point port in Australia with 50 Mt of handling capacity. It commissioned India's largest solar
power plant with a capacity 40 MW. As the firm achieved 3,960 MW capacity, it became the
largest private sector thermal power producer in India. In 2012 The company shifted its
focus on three business clusters – resources, logistics and energy.

Adani Power emerged as India's largest private power producer in 2014. Adani Power's total
installed capacity then stood at 9,280 MW. The Mundra Port, Adani Ports and SEZ Ltd.
(APSEZ), handled 100 Mt in fiscal 2013–14. On 16 May of the same year, Adani Ports
acquired Dhamra Port on East coast of India for ₹5,500 crore (equivalent to ₹75 billion or
US$940 million in 2020). Dhamra Port was a 50:50 joint venture between Tata Steel and L&T
Infrastructure Development Projects, which has been acquired by Adani Ports. The port
began operations in May 2011 and handled a total cargo of 14.3 Mt in 2013–14. With the
acquisition of Dhamra Port, the Group is planning to increase its capacity to over 200 Mt by
2020.

Krishnapatnam Port in Andhra Pradesh.

In 2015, the Adani Group's Adani Renewable Energy Park signed a pact with the Rajasthan
Government for a 50:50 joint venture to set up India's largest solar park with a capacity of
10,000 MW. In November 2015, the Adani group began construction at the port in
Vizhinjam, Kerala.

Adani Aero Defence signed a pact with Elbit-ISTAR and Alpha Design Technologies to work in
the field of Unmanned Aircraft Systems (UAS) in India in 2016. In April, Adani Enterprises
secured approval from the Government of Gujarat to begin work on building a solar power
equipment plant. In September, Adani Green Energy (Tamil Nadu), the renewable wing of
the Adani Group, began operations in Kamuthi in Ramanathapuram, Tamil Nadu with a
capacity of 648 MW at an estimated cost of ₹4,550 crore (equivalent to ₹56 billion or
US$700 million in 2020). In the same month, the Adani Group inaugurated a 648 MW single-

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location solar power plant. It was the world's largest solar power plant at the time it was set
up. In December, the Adani Group inaugurated a 100 MW solar power plant in Bhatinda, the
largest in Punjab. The plant was built at a cost of ₹640 crore (equivalent to ₹782 crore or
US$98 million in 2020).

On 22 December 2017, the Adani Group acquired the power arm of Reliance Infrastructure
for ₹18,800 crore (US$2.89 billion).

In October 2019, French oil and gas company Total Energies bought a 37.4% stake in Adani
Gas for ₹6,155 crore (US$874.04 million) and obtained joint control of the company. Total
also invested US$510 million in a subsidiary of Adani Green Energy in February 2020.

In August 2020, Adani Group obtained a majority stake in Mumbai and Navi Mumbai
airports after entering a debt acquisition agreement with GVK Group. Through a concession
agreement with the Airports Authority of India, Adani Group also obtained a 50-year lease
on Ahmedabad, Guwahati, Jaipur, Lucknow, Mangalore and Thiruvananthapuram airports.

In May 2021, Adani Green Energy acquired SB Energy, a joint venture of SoftBank Group and
Bharti Enterprises, for US$3.5 billion.

In May 2022, the Adani Group acquired Ambuja Cements and ACC for US$10.5 billion. The
deal will make the Adani Group the second largest cement maker in India.

In May 2022, UAE-based conglomerate International Holding Company (IHC), headed by

Syed Basar Shueb, invested US$2 billion in three Adani Group companies, namely Adani
Green Energy, Adani Transmission and Adani Enterprises. In June 2022, TotalEnergies
acquired a 25% stake in Adani New Industries, the newly formed green hydrogen subsidiary
of Adani Enterprises, for US$12.5 billion.

Listed companies
Adani Enterprises
Adani Enterprises is a holding company, which is primarily engaged in mining and trading of
coal and iron ore on a standalone basis, and acts as an incubator for Adani Group's new
business ventures. It has three main subsidiaries: Adani Wilmar (food processing), Adani
Airport Holdings (airport operations) and Adani Road Transport (road development).

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Through its other subsidiaries, Adani Enterprises also has business interests in solar PV
module manufacturing,[38] water infrastructure, data centers, agri-output storage and
distribution, defence and aerospace, bunkering, rail and metro infrastructure, real estate,
financial services, oil exploration, petrochemicals and cement.

Adani Green Energy

Adani Green Energy is the renewable energy arm of the group, having wind and solar power
plants in its portfolio. It is the world's largest solar power developer by capacity, with a total
capacity of 12.3 GW. In 2022, Adani Green formed 3 new subsidiary companies, called Adani
Renewable Energy Thirty Six, Adani Renewable Energy Forty Limited and Adani Renewable
Energy Forty Seven Limited.
Adani Ports & SEZ
A view of Mundra Port in 2017
Adani Ports & SEZ (APSEZ) is the largest private port company and special economic zone in
India, with ten ports and terminals including Mundra Port, its largest. The company is
headed by Karan Adani, CEO of APSEZ. The company's operations include Port management,
logistics and the special economic zone. The company operates at the following ports:
Mundra, Dahej, and Hazira, Gujarat; Dhamra, Odisha; Kattupalli, Tamil Nadu; and Vizhinjam,
Kerala.
Adani Power
Mundra Thermal Power Station in Gujarat
Adani Power was established in August 1996. The company develops and maintains power
projects and is the largest private sector power generation company in the country. It has a
combined installed capacity of 12,450 MW with four thermal power projects across India.
Adani Transmission
Integrated in 2013, Adani Transmission handles the commissioning, operations and
maintenance of electric power transmission systems. As of May 2021, the company holds,
operates and maintains 17,200 circuit kilometres of transmission lines that range from 400
to 765 kilovolts, making it India's largest private sector power transmission and distribution
network.
Adani Total Gas
Adani Total Gas is a city gas distribution company serving both industrial and residential
customers in India through piped natural gas connections and compressed natural gas
stations. It is a joint venture between Adani Group and the French oil and gas company
TotalEnergies. Adani Total Gas has presence in 22 geographical areas (GAs) as a standalone
entity as of November 2020. In addition, Indian Oil-Adani Gas Pvt. Ltd., a 50:50 joint venture
between Adani Total Gas and Indian Oil Corporation, operates city gas distribution networks

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in 19 GAs. With a combined presence of 41 GAs in 74 districts, Adani Total Gas is the largest
city gas operator in India. Recently, The Adani Group announced strategic collaboration with
Snam, Europe's leading gas infrastructure company on energy mix transition.
Adani Wilmar
Adani Wilmar, a joint venture between Adani Enterprises Ltd and Wilmar International
Limited, is the owner of the Fortune brand of edible oils.
In May 2022, Adani Wilmar Limited (AWL) acquired ‘Kohinoor’ brand from McCormick
Switzerland GMBH.

ACC Limited
ACC Limited (Formerly The Associated Cement Companies Limited) an Indian cement
producer, headquartered in Mumbai. It is a subsidiary of Ambuja Cements and a part of the
Adani Group. On 1 September 2006, the name of The Associated Cement Companies
Limited was changed to ACC Limited. The company was established in Mumbai,
Maharashtra on 1 August 1936.

History
In 1936, eleven cement companies belonging to Tata, Khatau, Killick Nixon and FE Dinshaw
groups merged to form a single entity, The Associated Cement Companies. Sir Nowroji B
Saklatvala was the first chairman of ACC. The first board of directors had some prominent
industrialists—J R D Tata, Ambalal Sarabhai, Walchand Hirachand, Dharamsey Khatau, Sir
Akbar Hydari, Nawab Salar Jung Bahadur and Sir Homy Mody.

The list of companies that were merged:

• The Indian Cement Co. Ltd.

• The Katni Cement and Industrial Co. Ltd.
• Budhi Portland Cement Ltd.
• The Okha Cement Co. Ltd.
• The Gwalior Cement Company Ltd.
• The Punjab Portland Cement
• The United Cement Co. Ltd.
• The Shahabad Cement Co. Ltd.
• The Coimbatore Cement
• The Dewarkhand Cement Co. Ltd.
• The C. P. Cement Co. Ltd.

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 • The Gagal Cement Works of ACC Limited at Barmana, Himachal Pradesh.
The management control of company was taken over by Swiss cement manufacturer Holcim
Group in 2004. ACC operated as subsidiary of Lafarge Holcim. On 1 September 2006, the
name of The Associated Cement Companies Limited was changed to ACC Limited. The
company is the only cement company to get Superbrand status in India.

On 14 April 2022, Holcim announced that it would exit from the Indian market after 17 years
of operations as part of a strategy to focus on core markets, and listed its stakes in ACC and
Ambuja Cements for sale.
On 15 May 2022, Adani Group acquired Holcim's stake in ACC and Ambuja Cements for
US$10.5 billion.

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Ambuja Cements Limited
Ambuja Cements Limited, formerly known as Gujarat Ambuja Cement Limited, is a major
Indian cement producing company. The Group markets cement and clinker for both
domestic and export markets.
Partnership
The company had entered into a strategic partnership with Holcim, the second-largest
cement manufacturer in the world from 2006. Holcim had, in January, bought a 14.8
percent promoters' stake in the GACL for INR 21.4 billion.
Currently Holcim holds 61.62% of the shares in Ambuja Cements. On 14 April 2022, Holcim
announced that it would exit from the Indian market after 17 years of operations as part of
a strategy to focus on core markets, and listed its stakes in Ambuja Cements and ACC for
sale. On May 15, 2022, Adani Group acquired Holcim's stake in Ambuja Cements and ACC
for US$10.5 billion.

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Media Coverage About Acquisition
Gautam Adani's Group has completed the acquisition of major Indian cement players,
Ambuja Cements and ACC. The Group has now become the second largest cement player in
the country. Holcim closed the deal with Adani Group on Friday by selling its entire stake in
Ambuja Cements at ₹385 per share and in ACC at ₹2,300 per share. The cash proceeds
aggregated to 6.4 billion dollars for Holcim.
In a statement, Swiss-based Holcim announced that the Group has closed the sale of its
business in India to the Adani Group, comprising its full stakes in Ambuja Cements at a share

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price of ₹385 and in ACC at a share price of ₹2,300, resulting in cash proceeds of $6.4 billion
for Holcim.
Holcim sold its entire 63.11% stake in Ambuja Cements, which owns a 50.05% interest in
ACC, as well as its 4.48% direct stake in ACC.
This transaction strengthens Holcim’s balance sheet and enables the company to continue
its acquisition strategy, building on recent investments of over CHF 5 billion in Solutions &
Products, the statement said.
Jan Jenisch, Holcim CEO said, “I would like to thank our 10,700 Indian colleagues who have
played an essential role in the development of our business over the years with their
relentless dedication and expertise. I am convinced that the Adani Group is the right home
for them as well as for our customers to continue to thrive in the future.
The Holcim-Adani deal was completed by way of the transfer of 100% shareholding of
Holderind Investments to Endeavour Trade and Investment in both Ambuja and ACC.
Endeavour Trade and Investment belongs to Adani Group, while the Mauritius-based
Holderind is the holding company of Holcim.
Jenisch added, "This divestment is another step in our transformation to become the global
leader in innovative and sustainable building solutions, strengthening our balance sheet and
giving us the firepower to continue our acquisition strategy."
The Ambuja and ACC acquisition makes this the largest ever acquisition by Adani, and India’s
largest ever M&A transaction in the infrastructure and materials space.
Both Ambuja and ACC shares nosedived today. However, earlier in the day, Ambuja shares
clocked a new 52-week high of ₹550.15 before correcting.
On BSE, Ambuja shares closed at ₹516.30 apiece down by 4.19%. The company's market cap
is around ₹1,02,518.86 crore.
ACC shares shares dropped by 4.90% to end at ₹2614.80 apiece. The company's market
valuation is at ₹49,102.61 crore.
In terms of market share, through the acquisition of Ambuja Cements and ACC, Adani Group
holds a market valuation of ₹1,51,621.47 crore in the sector – making it the second largest
cement player. Currently, Ultratech Cement is the largest player with a market valuation of
over ₹1.87 lakh crore.
Speculations are that Gautam Adani's elder son Karan Adani will oversee the family’s scaled-
up cement business.
Post-change in management, ACC announced that the board of directors approved the
extension of the current financial year till 31st March 2023 and change in the financial year
of the Company from 1st January – 31st December every year to 1st April – 31st March
every year.

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Also, on Friday, as per the regulatory filing, Ambuja received the board of directors'
approval for issuing nearly 47.75 crore warrants each convertible into, or exchangeable for -
- 1 fully paid-up equity share having a face value of ₹2 each -- to Harmonia Trade and
Investment on a preferential basis.

Adani Cement
Adani Cement or Adani Cement Industries Limited (ACIL) is a cement company based in
Gujarat, India. It was incorporated by Adani Group on June 11, 2021. Adani Cement is
wholly-owned subsidiary of Adani Enterprises and has not begun its business operations. It
was reported in June 2021 that the Adani Group planned to set up a cement plant in
Maharashtra which will have an initial capacity of 5-Million tonnes per annum with an
approximate investment of ₹900-1,000 crore. The Group has also proposed a 10-million
tonnes per annum Lakhpat cement plant, but later put the plans for that plant on hold.
• Largest acquisition in India's Infrastructure and Materials space valued at USD 6.50
billion
• Post the transaction, Adani will hold 63.15% in Ambuja Cements and 56.69% in ACC
(of which 50.05% is held through Ambuja Cements)
• The combined market capitalization of Ambuja Cements and ACC is USD 19 billion as
on date
• With this acquisition, Adani is now India’s second largest cement manufacturer
(capacity 67.5 MTPA)
• Enhanced corporate governance with 100% independent directors on Audit
Committee and Nomination & Remuneration Committee
• Two new Board committees – Corporate Responsibility Committee and Public
Consumer Committee – comprising solely of independent directors, will drive ESG
assurance and consumer-first approach

Mumbai, 16 September 2022: The Adani Family, through Endeavour Trade and Investment
Ltd (“BidCo”), a special purpose vehicle, has successfully completed the acquisition of
Ambuja Cements Ltd and ACC Ltd. The transaction involved the acquisition of Holcim’s stake
in Ambuja and ACC along with an open offer in both entities as per SEBI Regulations.

The value of the Holcim stake and open offer consideration for Ambuja Cements and ACC is
USD 6.50 billion, which makes this the largest ever acquisition by Adani, and also India’s
largest ever M&A transaction in the infrastructure and materials space. Post the transaction,
Adani will hold 63.15% in Ambuja Cements and 56.69% in ACC (of which 50.05% is held
through Ambuja Cements).

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"What makes cement an exciting business is the headroom for growth in India, which
exceeds that of every other country well beyond 2050,” said Mr Gautam Adani, Chairman,
Adani Group. “Cement is a game of economics dependent on energy costs, logistics and
distribution costs, and the ability to leverage a digital platform to transform production as
well as gain significant supply chain efficiencies. Each one of these capabilities is a core
business for us and therefore provides our cement business a set of unmatched adjacencies.
It is these adjacencies that eventually drive competitive economics. In addition, our position
as one of the largest renewable energy companies in the world will help us manufacture
premium quality green cement well in line with the principles of a circular economy. All of
these dimensions put us on track to become the largest and most efficient manufacturer of
cement by no later than 2030.”

Currently, Ambuja Cements and ACC have a combined installed production capacity of 67.5
MTPA. The two companies are among the strongest brands in India with immense depth of
manufacturing and supply chain infrastructure, represented by their 14 integrated units, 16
grinding units, 79 ready-mix concrete plants and over 78,000 channel partners across India.

The Board of Ambuja Cements approved an infusion of INR 20,000 Cr into Ambuja by way of
preferential allotment of warrants. This will equip Ambuja to capture the growth in the
market. The actions will significantly accelerate value creation for all stakeholders, in line
with the Adani Group’s business philosophy.

Both Ambuja Cements and ACC will benefit from synergies with the integrated Adani
infrastructure platform, especially in the areas of raw material, renewable power and
logistics, where Adani Portfolio companies have vast experience and deep expertise.
Ambuja and ACC will also benefit from Adani’s focus on ESG, Circular Economy and Capital
Management Philosophy. The businesses will continue to be deeply aligned to UN
Sustainability Development Goals with clear focus on SDG 6 (Clean Water and Sanitation),
SDG 7 (Affordable and Clean Energy), SDG 11 (Sustainable Cities and Communities) and SDG
13 (Climate Action).

In line with the Adani Portfolio’s governance philosophy, the board committees of both
Ambuja Cements and ACC have been reconstituted. The Audit Committee and the
Nomination & Remuneration Committee now comprise 100% independent directors.
Further, two new committees have been constituted – the Corporate Responsibility
Committee and the Public Consumer Committee – both comprising 100% independent
directors to provide assurance to the board on ESG commitments and maximise consumer

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satisfaction. Also, a Commodity Price Committee has been constituted, comprising 50%
independent directors, to strengthen risk management.

The transaction was financed by facilities aggregating to USD 4.50 billion availed from 14
international banks. Barclays Bank PLC, Deutsche Bank AG and Standard Chartered Bank
acted as Original Mandated Lead Arrangers and Bookrunners to the transaction. Barclays
Bank PLC, DBS Bank, Deutsche Bank AG, MUFG Bank and Standard Chartered Bank acted as
Mandated Lead Arranger and Bookrunners to the transaction. In addition, BNP Paribas,
Citibank, Emirates NBD Bank, First Abu Dhabi Bank, ING Bank, Intesa Sanpaolo S.p.A, Mizuho
Bank, Sumitomo Mitsui Banking Corporation and Qatar National Bank acted as Mandated
Lead Arrangers for the transaction.

Barclays Bank PLC and Deutsche Bank AG acted as M&A advisors to BidCo, with Standard
Chartered Bank acting as the Structuring Advisor, and ICICI Securities and Deutsche Bank AG
acted as merchant bankers to the open offer by BidCo for Ambuja Cements and ACC.

Cyril Amarchand Mangaldas and Latham and Watkins LLP acted as M&A counsel to BidCo.
Cyril Amarchand Mangaldas and Latham and Watkins LLP also acted as legal counsels to
BidCo for the financing with Allen & Overy LLP and Talwar Thakore and Associates acting as
legal counsels to the lenders.
Days after completing a USD 6.5 billion acquisition of Ambuja Cements and ACC, billionaire
Gautam Adani said his group has planned to double cement manufacturing capacity and
become the most profitable manufacturer in the country.
He saw a multifold rise in cement demand in India on the back of record-breaking economic
growth and the government’s infrastructure creation push, which will give significant margin
expansion.
In a speech made at an event to mark the completion of the acquisition on September 17,
the Adani Group founder and chairman said the ports-to-energy conglomerate has in a
single stroke become the second largest cement manufacturer in the country.
Adani Group last week completed buyout of Swiss major Holcim’s stake in the two firms.
Calling the acquisition historic, he said this buyout is India’s largest ever inbound M&A
transaction in the infrastructure and materials space and closed in a record time of 4
months.
“Our entry into this business is happening at a time when India is on the cusp of one of the
greatest economic surges seen in the modern world,” he said in the speech, which was
released on Monday.

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Stating reasons for the foray into the cement space, he said while India is the second largest
producer of cement in the world, its per capita consumption is just 250 kg compared to
1,600 kg of China. “This is almost a 7x headroom for growth.” Also, “as several of the
government’s programmes gather momentum, the long-term average growth in cement
demand is expected to be 1.2 to 1.5 times the GDP. We anticipate growing at twice this
number,” he said.
With trillion-dollar investment planned in infrastructure and housing in the country, cement
is an attractive “adjacency to our infrastructure business, especially the group’s ports and
logistics business, green energy business, and the e-commerce platform being developed,”
he said.
Adani Group’s competency in driving operational efficiency will result in “significant margin
expansion to become the most profitable cement manufacturer in the country,” he said.
“And we anticipate going from the current 70 million tonne capacity to 140 million tonne in
next 5 years.” On his group’s growth philosophy, Adani, 60, said it is the belief in India’s
growth story.
India will be a USD 25-30 trillion economy by 2050, which points to huge growth prospects,
he said.
The group is the world’s largest solar power company and has committed USD 70 billion
investment in clean energy business including green hydrogen, he said.
Adani Group is the largest airport operator in the nation with 25 per cent of passenger
traffic and 40 per cent of air cargo. It is the largest ports and logistics company in the
country with a 30 per cent market share.
“We are India’s largest integrated energy player spanning generation, transmission,
distribution, LNG, LPG, city gas and piped gas distribution. Each of these businesses is
growing at double-digit rates,” he said.
While the group has won some of the largest road contracts in the country and is on the
way to becoming the largest player in this sector, a grand IPO of Adani Wilmar has made it
the highest-valued FMCG company in the country.
“We have declared our path forward in multiple new sectors that include data centers,
super apps, aerospace and defence, industrial clouds, metals, and petrochemicals,” he said.
“Our finances are stronger than ever before, and we continue to raise billions of dollars
from international markets and strategic partners to further accelerate our growth.” Adani
Group’s market cap, he said, stands at USD 260 billion – having grown faster than any
company ever in India, he added.

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