Adani Group To Keep ACC, Ambuja Brands Separate, No Plan To Merge Units

The clarification came at an annual shareholder meeting after media reports emerged that the group was exploring a merger between the two companies.

The Adani Group became India's second-largest cement producer in 2022 after acquiring Ambuja Cements and ACC for $10.5 billion from Switzerland's Holcim. 

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Adani Group will maintain the usage of its ACC and Ambuja cement brands for selling cement products and has no intention to merge the two entities, said Ajay Kapur, Chief Executive Officer of both cement companies, reported Reuters. The clarification came at an annual shareholder meeting after media reports emerged that the group was exploring a merger between the two companies.

"No disruption is expected in the usage of these legacy brands," said Kapur, as per the news agency. 

The Adani Group became India's second-largest cement producer in 2022 after acquiring Ambuja Cements and ACC for $10.5 billion from Switzerland's Holcim. 

"We are looking to improve the cement business's EBITDA margins by 400-450 rupees per ton over the next 24 months," Kapur said, as per the report. He also pointed toward efforts to bring down production costs of the firms by streamlining manufacturing and logistics processes. Kapur said that ACC is looking to add 16 million tonnes of new capacity in the next two to five years as India's cement demand is seen growing at 7-8 per cent. 

After the US short-seller Hinderburg report came out shares of Adani group companies, including Ambuja and ACC were impacted.  Stocks Adani-owned cement firms continued to trade below their January levels, the report noted. Adding that Ambuja's shares were down 15.7 per cent, and ACC's shares were down 23 per cent since Hindenburg came out with its short positions.

According to the report, Adani's cement business head also revealed that the company's upcoming plant in Ametha, Madhya Pradesh is set to begin operations soon. This expansion aligns with Adani Group's previous announcement to double its cement production capacity over the next five years.

In 2022, Adani Group acquired Ambuja Cement and ACC from Switzerland's Holcim for $10.5 billion. Before the acquisition, Holcim held a 63.19 per cent stake in Ambuja Cements and a 54.53 per cent stake in ACC, with 50.05 per cent of the latter being held through Ambuja Cements.