Holcim-Lafarge India Business Amalgamation Scheme Alternates to Amalgamation Scheme

1. CA. Naman Khanna
Mergers & Acquisitions
Strategic Investment
Strategy Analysis
Holcim India Interests

2. Interests Structure Scheme InferenceStrategy Prospects

3. Interests Structure Scheme InferenceStrategy Prospects
• Capacity – 29 MMT
• 5 Mfg. Plant and 8 Grinding Units
• Market Cap. – Rs. 15,589 crores
• Net Worth – Rs. 10,103 crores
• Capacity – 25 MMT
• 16 Plants across the country
• Market Cap. – Rs. 12,581 crores
• Net Worth – Rs. 8,236 crores
80
202
360
1340

4. Interests Structure Scheme InferenceStrategy Prospects
2006 - Post Buy-Out
Journey : 2006-13
2013 – Pre Scheme

5. Interests Structure Scheme InferenceStrategy Prospects
2006 – Post Buy - Out
Holcim Group
Ambuja ACC
GACIPL 35.09%
100%
(Later Holcim Ind.)
26.44%

6. Interests Structure Scheme InferenceStrategy Prospects
Journey : 2006 - 13
26.4%
45.6%
50.4%
2006
2007
2013
35.1%
46.2%
50.3%2006
2009
2013
Holcim Group Holdings

7. Interests Structure Scheme InferenceStrategy Prospects
2013 – Pre Scheme
Holcim Group
ACCAmbuja
Holcim India
40.73%
50.01%
0.29%
9.75%
100%

8. Interests Structure Scheme InferenceStrategy Prospects
Amalgamation
Scheme Analysis

9. Interests Structure Scheme InferenceStrategy Prospects
Holcim Group
ACC
Holcim India
Ambuja
9.75% 50.01%
100%40.73% 0.29%
• Ambuja to acquire 24% in Holcim India
for cash consideration of INR 3500 crs
to Holcim Mauritius
• Merger of Holcim India with Ambuja
Cement thru an all stock merger.
• Ambuja Cement to issue 584 mn equity
shares to Holcim Mauritius (76%)
• Holcim India’s 9.75% holding stands
cancelled
Amalgamation Scheme
(Appointment date – 01.04.2013)
584mnShares 24%
76%
X
INR3500crs.

10. Interests Structure Scheme InferenceStrategy Prospects
Holcim Group
ACC
Ambuja
61.21%
50.01%
0.29%
• New holding of Holcim Group in
Ambuja raised to 61.21%
• New Equity issued – 584 mn Equity
shares face value INR 2 each
• Effective Holding of Holcim Group in
ACC to be 30.90%
• Technological Know-How fee of 1% of
Net Sales from ACC and Ambuja to
continue
Post Scheme Structure
Expected Benefits
• Synergy impact of about INR 900 Crores per annum.
• Preparing grounds for further optimization of group
structure.

11. Interests Structure Scheme InferenceStrategy Prospects
Alternate A
Alternate B
Alternate C

12. Interests Structure Scheme InferenceStrategy Prospects
Alternate A : Buy out option
Holcim Group
Ambuja ACC
Holcim India
50.30%50.35%
100%
• Holcim Group (Mauritius) will sell its
holding in Ambuja & ACC to Holcim
India
• Holcim India will become direct
Holding company of Ambuja and ACC.
• No Cash outflow from Ambuja.

13. Interests Structure Scheme InferenceStrategy Prospects
Alternate B : Hybrid – with No reverse FDI
Holcim Group
ACC
Ambuja
61.21%
50.01%
15.26%
• Holcim Group will utilize INR 3500 crs.
to strengthen its control in ACC
• Holcim Group direct holding in ACC will
increase to 15.26%
• Total holding of Holcim Group in
Ambuja will be 61.21%.
• No reverse FDI

14. Interests Structure Scheme InferenceStrategy Prospects
Alternate C : Plain Vanilla Merger
Holcim Group
ACC
Ambuja
64.5%
50.01%
0.29%
• Ambuja will take over Holcim India and
will issue new equity shares for 100%
consideration
• Total holding of Holcim Group will
increase to 64.5%.
• No Cash outflow from Ambuja.

15. Interests Structure Scheme InferenceStrategy Prospects
• Proposed Scheme has not yet been implemented.
• Cash & Cash Equivalents balance of Ambuja as of 30th June 2015 – INR 4673 crores.
• Optimization of group structure in light of global merger
This transaction is a natural and an important next step towards further strengthening Holcim Group’s
India platform to increase profitability and facilitate more flexible use of capital. ACC has a strong heritage
and its brands have great value in the market – both companies will significantly benefit from a closer
collaboration to be ready to embark on the next phase of growth and optimization.
Onne Van Der Weijde, MD-Ambuja
”
“

16. Interests Structure Scheme InferenceStrategy Prospects
Parameters Pre Scheme
Approved
Scheme
Alternate A
(Buy-Out)
Alternate B
(Hybrid)
Alternate C
(Vanilla)
Holding Valuation 26,510 34,708 26,510 38,208 38,195
Cash Consideration 3,500
Dividend Income 564 720 564 805 787
(INR/Crs.)
• As per Share price of 24.07.13
• Dividend Rate – Last Dividend rate

17. Thank You…

18. Mergers & Acquisitions
Strategic Investment
Strategy Analysis
Holcim India Interests
CA. Naman Khanna