Sagar Cements is in advanced talks to acquire Andhra Cements from the Jaypee Group, the Economic Times (ET) of India has learnt from two sources. JSW Cement is another potential contender, according to the sources.

Andhra Cements has two plants in the southeastern Indian state of Andhra Pradesh with a combined capacity of 2.6Mta. It also has a 25MW captive power plant under construction.

The sources said that Sagar Cements will make an open offer to the minority shareholders of Andhra Cements as per Securities and Exchange Board of India (SEBI) guidelines.

A company spokesperson refused to comment "on market speculation" when contacted by the ET.