UltraTech Cement and India Cements have received notices from the Competition Commission of India (CCI) over the takeover of the latter by billionaire Kumar Mangalam Birla’s company.
In July, India’s largest building materials maker, Birla struck a deal with India Cements vice-chairman & MD N Srinivasan and his family to acquire their cement business for Rs 3,954 crore. The acquisition was subject to various approvals, including that of the CCI.
The cement majors informed the stock exchange that the notice under Section 29(1) of the Competition Act, 2002 was received on Thursday. It pertains to the procedure for investigation of combination.
According to the section, the commission is of the opinion that a combination is likely to cause or has caused an appreciable adverse effect on competition within the relevant market in India. It shall issue a notice to show-cause to the parties to the combination calling upon them to respond within 30 days of the receipt of the notice, as to why investigation in respect of such combination should not be conducted.
UltraTech said it would be responding to the notice. “The southern market for grey cement, where India Cements primarily operates, is highly competitive and fragmented with the presence of over 35 grey cement manufacturers. We are confident of the merits of our case,” the company said in the regulatory filing on Friday.
India Cements said the notice from CCI is regarding the proposed acquisition of equity shares of the company held by its promoters and others by UltraTech Cement under Share Purchase Agreements executed on July 28, 2024. “We are in the process of furnishing our response to the CCI in this regard. We believe that we will be able to satisfy any concerns the CCI may have as the cement market is extremely competitive,” India Cements said in a separate regulatory filing.
