Displaying items by tag: ABG Cement
KKR backs SIMEC on ABG Cement buyout
02 July 2015India: According to The Economic Times, private equity company KKR will team up with diversified trading and commodities group SIMEC to invest US$142m to take over the cement business of debt-laden ABG Group through a complex, multi-tiered financial transaction. The funding will help ABG's founder promoter Rishi Agarwal to complete the 'last mile' of his much-delayed cement plant project in Gujarat.
The first leg of the 'special situations' transaction, which will be concluded in the coming weeks, will see KKR fund SIMEC to gain a 51% controlling stake in ABG Cements for US$82.6m. This will be followed by an additional US$60.6m of funding collateralised by Agarwal's unencumbered shares in the company. The money will be used to finish the project, fund working capital and pay back overdue creditors.
ABG Cement has been planning a 5.8Mt/yr cement plant in Gujarat since 2010. However, due to significant cost and time overrun, only a 3.3Mt/yr clinker plant at Kutch near the limestone reserves was completed. Agarwal ran out of money to complete the grinding unit at Surat. The plant is ultimately expected to produce slag cements with blast furnace slag coming from Essar Steel. It will be the only slag cement plant in western India.
SIMEC has already made a part payment to show its commitment to the deal. KKR, too, has signed a term sheet with ABG's management. A detailed due diligence process is currently ongoing. In 2014, SIMEC had agreed to buy into ABG's cement business, but the deal was not concluded. Now with KKR's funding, it is expected to close soon.
India: The Government of Kerala is planning to construct a cement terminal at Azhikkal port in the state. The vessel capacity is up to 10,000DWT (dead weight tonnage) with a 6 - 12m draft. ABG Group has been awarded the contract. The project is waiting for the final approval from the finance and planning board department and is planned for completion in five years from the date of approval.
ABG to sell stake in cement business
09 January 2013India: Private sector ship builder ABG Group is in talks with private equity and financial firms to sell a minority stake in its cement business for about US$150m. According to Dhananjay L Datar, director of ABG Group, a potential deal is at a preliminary stage with several parties showing interest in the cement unit.
The group's cement business, ABG Cement, has a 6.5Mt/yr plant in Kutch, Gujarat, which is expected to be commissioned by the end of January 2013. India media has linked equity firms Blackstone and KKR to the deal. ABG Group originally announced its plans to enter the cement sector in 2008 with an initial investment of US$328m.