Dalmia Cement's capacity to rise to 20 mtpa after JAL deal

Dalmia Cement (Bharat)'s capacity will go up to 20 million tonnes per annum (mtpa) following its acquisition of Jaiprakash Associates' (JAL) 74 per cent stake in a joint venture with SAIL for an enterprise value of Rs 1,150 crore.
DCBL Board has approved acquisition of 74 per cent stake in Bokaro Jaypee Cement Limited (BoJCL), a 74:26 joint venture between JAL and Steel Authority of India (SAIL).
"With this acquisition, DCBL's current installed capacity (including subsidiaries and associates) will reach 20 mtpa," Dalmia Cement (Bharat) said in a release.
BoJCL has a 2.1 mtpa cement unit at Bokaro in Jharkhand. The joint venture has a 30-year clinker supply arrangement with JAL and a slag supply arrangement for the same period with SAIL.

"We are delighted to associate with one of India's finest infrastructure players. The transaction was completed in a record time with excellent chemistry and co-operation between the professional teams of JAL and DCBL," said Mahendra Singhi, Group CEO-Cement, DCBL.
"The total enterprise value is Rs 1,150 crore ... The proposed acquisition would be funded through a mix of debt and internal accruals," the company said.

DCBL also holds 47.3 per cent stake in OCL India, a major cement player in the eastern region, and is expanding capacity there.
The company is also setting up a 2.5 mtpa cement plant at Belgaum in Karnataka with an investment of Rs 1,344 crore, apart from expanding its capacity in Assam.

JAL, the flagship company of the diversified Jaypee Group, is also looking for buyers for divesting its 74 per cent stake in another joint venture with SAIL in Bhilai.
However, DCBL is reportedly not looking at any other plants for acquisition at the moment.