Sanghi Industries shares sink 12% as Board okays merger with Ambuja Cement

Sanghi Industries share price: Cement manufacturer Sanghi Industries’ shares bled on Wednesday, December 18, 2024, as the scrip plummeted 12.35 per cent to hit a fresh 52-week low of Rs 67.42 per share. 

 

The stock tanked after the company on December 17, announced that the Board of Directors has approved the Scheme of Arrangement between Sanghi Industries Limited (Transferor Company) and Ambuja Cements Limited (Transferee Company) and their respective shareholders.

 

The stock tanked after the company on December 17, announced that the Board of Directors has approved the Scheme of Arrangement between Sanghi Industries and Ambuja Cements and their respective shareholders. Under the deal, Ambuja Cements will issue 12 equity shares of the face value of Rs 2 each for every 100 equity shares of Sanghi Industries of face value Rs 10 each as recommended by the valuers and accepted by the Board and thereby, the eligible shareholders of Sanghi Industries will become the shareholders of Ambuja Cements. 

 

In an exchange filing, Sanghi Industries said, “We wish to inform that the Board of Directors of the Company at its meeting held, December 17, 2024, has approved the Scheme of Arrangement between Sanghi Industries Limited (Transferor Company) and Ambuja Cements Limited (Transferee Company) and their respective shareholders. The Scheme, inter alia, provides for the amalgamation of the Transferor Company with the Transferee Company.

 

The Scheme, however, is subject to necessary statutory and regulatory approvals under the applicable laws, including approval of the jurisdictional National Company Law Tribunal (NCLT).

 

On the flipside, Ambuja Cements shares rose up to 1.26 per cent to hit an intraday high of Rs 578.15 apiece.

 

“This merger aims to make our company more competitive and efficient, ultimately enhancing shareholder value. Enhanced working capital management and internal funds will support the growth of our business operations. Unified cash flow management will pool resources for faster expansion and cost savings in administration and governance, thereby simplifying compliance requirements. This advancement through a larger entity will increase market competitiveness and deliver greater value to our shareholders,” said Ajay Kapur, CEO of cement business at Adani Group.

 

Sanghi Industries is engaged in the business of cement manufacturing and marketing of various grades of cement.  The company has a large, fully integrated plant in Kutch, Gujarat, featuring advanced multi-fuel technology and significant limestone reserves. The plant includes a 6.6 MMTPA clinker plant, a 6.1 MMTPA cement plant, and 130 MW captive power plant and 13MW WHRS, along with a bulk cement terminal in Gujarat. 

 

The merger will enhance the business potential of the Sanghi Industries, add value to both the companies, and ultimately increase the shareholders’ value. The deal will also lead to reduction and rationalisation of multiple entities in the group, Sanghi Industries revealed in a statement.

 

At 10:04 AM, Sanghi Industries share was trading 10.54 per cent lower at Rs 68.81, while Ambuja Cements share was trading 0.08 per cent lower at Rs 570.50 per share. In comparison, BSE Sensex was trading 0.33 per cent lower at 80,414.53 levels.