What Adani’s Ambuja-Led Cement Merger Means for ACC and Orient Shareholders

ACC and Orient Cement said on December 22 that their boards have cleared proposals to merge their respective businesses into Ambuja Cements.

Ambuja Cements, in a statement, said the consolidation would result in a “one cement platform” with pan-India scale, delivering operational synergies through better use of manufacturing and logistics networks, a simpler corporate structure, a stronger balance sheet and more efficient capital deployment to support growth and reinforce market leadership.

 “The merger will simplify and rationalise the network, branding and sales promotion-related spends. This will help to optimise costs and improve margins by at least ₹100 per metric tonne. The merger will facilitate achieving targeted cost, margin expansion and growth metrics,” the Adani Group company said.

ACC, Orient merger details

Ambuja Cements has also announced the share swap ratios for its proposed mergers with ACC and Orient Cement, though the record date for the same is still awaited. Under the Ambuja-ACC merger, eligible ACC shareholders will receive 328 Ambuja Cements shares (face value ₹2 each) for every 100 ACC shares (face value ₹10 each), implying a swap ratio of 328:100. Based on the previous closing prices, 100 ACC shares valued at about ₹1.78 lakh would translate into 328 Ambuja shares worth around ₹1.77 lakh.

“The swap ratio with ACC largely remains at par with the closing market price, while it offers a ~9% premium for minority shareholders of Orient Cement,” said JM Financial in a note on Monday.

For the Ambuja-Orient Cement merger, eligible Orient Cement shareholders will receive 33 Ambuja Cements shares (face value ₹2 each) for every 100 Orient Cement shares (face value ₹1 each), implying a 33:100 swap ratio. At recent prices, 100 Orient Cement shares valued at about ₹16,352 would convert into 33 Ambuja shares worth roughly ₹17,818. Ambuja said the consideration has been determined on an arm’s-length basis, and the Adani Ambuja Cements and Adani ACC brands will continue to operate as usual after the mergers.

The proposed mergers of ACC and Orient Cement have appointed dates of January 1, 2026 and May 1, 2025, respectively. After the mergers, promoter ownership in Ambuja Cements will fall to 60.94% from the current 67.65%. The deal is expected to be completed within the next 12 months, subject to regulatory approvals. These include clearances from shareholders, creditors, SEBI and the NCLT, though approval from the Competition Commission of India (CCI) is not required, as per the brokerage.

A day after the announcement, ACC shares fell 0.8% to ₹1,761.65, while Orient Cement rose 5% to ₹172.05 and Ambuja Cements gained 2.18% to trade at ₹551.75 as of 12:29 pm on December 23.

What the merger means for Ambuja Cements

Post-merger, both key brands, Ambuja and ACC, will continue to operate independently, retaining their strong product portfolios and market positioning in their respective markets. The proposed merger is expected to simplify and rationalise the operating structure, including network optimisation, branding and sales promotion spends, as per the JM Financial note.

No separate agreements will be needed with ACC, Orient, Penna and Sanghi, as they will become part of Ambuja after the merger. Removing these agreements and related-party transactions is expected to improve transparency and corporate governance, as per the brokerage. The note added that ACC’s state-level incentives in various states are also expected to continue for Ambuja for the remaining period of these schemes.

The company plans to raise its cement capacity to 118 million tonnes by FY26 and 130–135 million tonnes by FY27, and has increased its FY28 target to 155 million tonnes from 140 million tonnes earlier. The additional 15 million tonnes of capacity will be added through plant upgrades and new units, at an estimated cost of about $48 per tonne.

Clinker capacity is expected to rise from 73 million tonnes to 81 million tonnes by FY27 and 96 million tonnes by FY28. Ambuja aims to cut its production cost to ₹4,000 per tonne by FY26 and then reduce it by about 5% each year, reaching ₹3,800 per tonne by FY27 and around ₹3,600–3,650 per tonne by FY28. The company has earlier guided for EBITDA of ₹1,450–1,500 per tonne by FY28.

With higher volumes and better margins, Ambuja is expected to see strong profit growth, with EBITDA projected to grow at over 30% annually between FY25 and FY28, and blended EBITDA per tonne rising from ₹795 in FY25 to about ₹1,250 by FY28, said the brokerage