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India – CCI Approves The Proposed Acquisition Of Cement Manufacturing Facilities Of Heidelberg Cement India Ltd By JSW Steel.

27 January, 2014

 

 

On December 12, 2013, CCI approved the proposed acquisition of the Raigadh based cement manufacturing undertaking of Heidelberg Cement India Ltd. (‘HCIL’) by JSW Steel Limited (‘JSW Steel’), on a slump sale basis.


JSW Steel is a listed company and is a part of the JSW Group, which has its presence in the steel, energy, infrastructure, cement, aluminium and information technology sectors. HCIL, a listed company, is engaged in the manufacture of different varieties of cement like Portland Slag Cement (‘PSC’), Ordinary Portland Cement (‘OPC’) and Ground Granulated Blast Furnace Slag (‘GGBS’).


CCI observed that JSW Steel, the acquirer, is not engaged in the production of cement. While it does operate a cement grinding unit, the entire quantity of cement manufactured at this facility is meant purely for captive consumption. However, JSW Cement Limited (‘JSW Cement’), a company which is part of the JSW Group, is engaged in the manufacture and sale of different types of cement such as PSC, OPC and GGBS.


CCI further observed that while JSW Steel, a relatively new player in the cement industry, had a cumulative installed capacity of 5.2mtpa of cement, HCIL had a capacity to produce only 0.6 mtpa of cement. Therefore, the acquisition of the cement manufacturing undertaking of HCIL by JSW Steel would not substantially increase the total cement production of the JSW Group. Further, JSW Steel presently sells blast furnace slag (‘BF Slag’) to HCIL. Post the proposed acquisition, the obligation of HCIL to lift BF slag from JSW Steel would end, and the proposed combination would help JSW Steel to use the BF Slag produced by it effectively and efficiently.


In light of the above, CCI was of the opinion that the proposed combination was not likely to have any Adverse Effect and, accordingly, approved the proposed combination under subsection (1) of Section 31 of the Act.

 

AZB

 

For further information, please contact:

 

Zia Mody, AZB & Partners
zia.m[email protected]

 

Abhijit Joshi, AZB & Partners 
[email protected]


Shuva Mandal, AZB & Partners 
[email protected]

 

Samir Gandhi, AZB & Partners
[email protected]


Percy Billimoria, AZB & Partners 
[email protected]

 

Aditya Bhat, AZB & Partners 
[email protected]

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