Grapevine: UltraTech front runner for Emami cement; ESAF Small Finance Bank may list
Photo Credit: Reuters

UltraTech Cement Ltd, India’s largest producer of the building material, has emerged as the front runner to buy Emami Group’s cement business in an all-cash deal worth up to Rs 7,000 crore ($983.6 million at current exchange rate), people with direct knowledge of the discussions told Mint.

The only other contender for the final bidding round is Ambuja Cements Ltd, part of the LafargeHolcim Group, they said, adding that Ambuja’s offer is smaller than Ultratech’s.

“The final binding bid round is likely to end next week,” said one of the people.

The purchase of Emami Cement will help UltraTech make deeper inroads into eastern India and further consolidate its leadership of the domestic market.

“Both UltraTech and Ambuja’s offers are currently undergoing final due diligence by the banker and adviser. UltraTech intends to monopolise the market in the central-east, east and the far-east geography, where Emami owns most of its cement manufacturing units,” said another person.

Emami Group had earlier in October 2018 planned to raise $136 million through an initial share sale which got delayed.

Meanwhile, Kerala-based ESAF Small Finance Bank is set to file a draft prospectus this month for a Rs 1,000 crore ($140.5 million at current exchange rate) initial public offering (IPO), two people aware of the matter told Mint.

“The fundraising will be a mix of primary and secondary share sales,” said one of the persons. “The company could also raise part of the proceeds through a pre-IPO funding round of around Rs 200 crore,” he said.

In September 2018, the company had raised Rs 464 crore in a private placement from Bajaj Allianz, Muthoot Finance, Pi Ventures and others.

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