Reliance Infrastructure to sell cement arm to Birla Corp

Reliance Infrastructure (RInfra) has signed a share purchase agreement with Birla Corp to sell 100 per cent in Reliance Cement Company (RCCPL). The deal values cement business of RInfra at INR48bn.

Under the transaction, Birla Corporation will acquire the 100 per cent shareholding of RInfra in RCCPL.
The deal is still subject to approval by the Competition Commission of India, among others.

Reliance announced back in November that it would be divesting of its cement and roads segments to focus on its defence business. With a total cement capacity of around 9.3Mta, it has units in Rajasthan, Madhya Pradesh, Uttar Pradesh and West Bengal. Following this buyout, Birla Corp's total capacity will rise to 15.5Mta.

Birla Corp hit the headlines earlier this week afte a deal to acquire two Lafarge India units with a capacity of 5.15Mta fell through. On Tuesday Birla said in a notice to the Bombay Stock Exchange that it had now been informed about Lafarge India's "inability to proceed" with the transaction. After consultation with lawyers, the company “has decided not to accept their contention and is in the process of taking appropriate legal measures,” it said.