Orient Cement has agreed to acquire Nigrie Cement Grinding unit (Nigrie unit) from Jaiprakash Power Ventures (JPVL) for an Enterprise Value of Rs 500 crore. The Enterprise Value is on a cash-free, debt-free basis and is subject to adjustments on account of working capital, if any. Moelis & Company is the financial advisor, while Cyril Amarchand Mangaldas is the legal counsel to Orient Cement for this transaction.
Nigrie unit in Singrauli area, Madhya Pradesh, housed within JPVL, is a cement grinding unit with a capacity of 2.0mtpa. This grinding unit is located very close to the end markets in Bihar, Jharkhand and Eastern UP. The acquisition is subject to satisfactory negotiation and execution of definitive agreements, approval of the Competition Commission of India and other relevant regulatory and third party approvals and will be funded by Orient Cement through a mix of internal accruals, debt and equity funding.
The acquisition of the Nigrie unit provides Orient Cement with a high quality asset at a strategically well located region. The operational asset provides a ready to market capacity for Orient Cement and also complements its asset portfolio, post the transaction.
