Sajjan Jindal’s JSW makes $7bn bid for Holcim’s India businesses

Chair of country’s biggest steelmaker says Narendra Modi supported ‘nationalistic’ companies

Indian industrialist Sajjan Jindal’s steel-to-energy conglomerate JSW Group will make a $7bn bid for Holcim’s India subsidiaries as the Swiss cement group seeks to divest from international assets.

Jindal said in an interview that JSW would offer $4.5bn in its own equity and $2.5bn from undisclosed private equity partners for Holcim’s Indian assets Ambuja Cement and ACC.

The JSW chair said the acquisition of 63 per cent of Ambuja would be a “game-changer”.

If the deal is successful, it would increase JSW’s market share of the Indian cement market from about 3 per cent to 16 per cent, said analysts.

“This M&A opportunity is a one in a decade opportunity,” said Sumangal Nevatia, senior vice-president for metals, mining and cement at Kotak Securities.

Jindal is reportedly up against other powerful Indian conglomerates including the Birla and Adani families for Ambuja, which controls 13 per cent of the Indian market, Nevatia said, with annual production of 26mn tonnes in 2021.

Ambuja’s shares have risen 14 per cent over the past month to Rs370.43 ($4.78). Holcim declined to comment.

JSW’s attempt to expand its cement business comes as the steel company, India’s biggest by stock market capitalisation with revenues last year of $9.4bn, is working to acquire coal mines abroad to offset supply disruptions and high commodity costs.

Surging post-pandemic demand and the Ukraine war have pushed prices for the steel making commodity to record highs, with Australian coking coal hitting $590 a tonne in March, according to data provider CoalMint.

“The conflict is affecting the commodity prices globally and that’s giving a big concern,” Jindal said. “A lot of people are deferring their projects because they’re all feeling the cost has gone up nearly 40, 50 per cent.”

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