KKR to swap stake in Dalmia Cement with listed parent

Private equity firm KKR is swapping its stake in Dalmia Cement for a piece of its public listed parent, according to a stock market disclosure on Friday.

"Dalmia Bharat Ltd (DBL) signed a definitive agreement with KKR, under which it will acquire KKR's 15 per cent stake in DCBL in return of KKR getting 8.5 per cent stake in DBL as well as INR600 crore [INR6bn/US$88.7m] in cash," Punit Dalmia, managing director of Dalmia Bharat Group, told the Press Trust of India.

This deal not only simplifies DCBL's shareholding structure but will also make the cement maker a wholly-owned subsidiary of DBL, he added.

“We have been benefitted tremendously from KKR's network, strategic expertise and experience in value creation. Our capacity increased from 9Mt to 25Mt," Dalmia said. After KKR's investment, the firm undertook four acquisitions and greenfield expansions, among others.

Post-agreement, KKR will be the largest institutional shareholder in DBL.