Adani family invests Rs 6,661 crore in Ambuja Cements via warrants

The latest fund infusion will take Adani family stake in the cement co to 66.7 per cent

In a partial exercise of earlier issued convertible warrants, the Adani Family on Thursday announced that it has infused another Rs 6,661 crore in Ambuja Cements. With this, the family’s stake in the company now stands at 66.7 per cent.

The Gautam Adani-promoted conglomerate in a statement on Thursday said the Adani family has concluded a substantial infusion of funds in Ambuja Cements. With this, the family increased its stake in the company by 3.6 per cent to attain a 66.7 per cent holding, the statement said, calling it the family’s commitment to boost prospects and potential of the cement vertical.

In September 2022, the Adani group acquired Holcim’s Ambuja Cements and interests in ACC Ltd. Post the acquisition, in October 2022, Ambuja Cements announced the allotment of 47.74 crore warrants to Harmonia Trade and Investment Limited (part of the Adani Family) at an issue price of Rs 418.87 per warrant, and each warrant was convertible into one equity share, to be exercised at any time within a period of 18 months from the date of allotment of warrants. As per requirements, the Adani Family had already infused around Rs 5,000 crore, that is 25 per cent of the total issue size upfront in 2022.

Of the 47.74 crore shares, Ambuja Cements said on Thursday its board has approved the allotment of 21.20 crore equity shares of the company at a premium of Rs 416.87 per share, pursuant to the exercise and conversion of the October 2022 allotment. Ambuja Cements in Thursday’s trade closed at Rs 612.30 per piece, 1.76 per cent up from the previous day’s close.

The remaining 26.54 crore of warrants, Ambuja Cement said, Harmonia can convert by April 17. This could entail an infusion of another Rs 8,000 crore roughly.

Proxy advisory firm IiAS in 2022 had guided investors to vote against the decision to allot these warrants, stating it allows promoters the option to ride the stock price for 18 months.

Ajay Kapur, whole time director and chief executive officer for Ambuja Cements said, “This infusion of funds provides Ambuja capital flexibility for fast-tracked growth, capital management initiatives and best-in-class balance sheet strength.” The statement added, the funds infusion will aid expansion plans to take Adani’s cement portfolio (Ambuja Cements-ACC included) capacity to 140 million tonnes per annum (MTPA) by 2028, from the current 77.4 MTPA.