CRH seeks to cement deal with Jaypee to grow in India
BUILDING MATERIALS giant CRH has entered negotiations with Jaypee Cement Corporation to pick up an equity stake in Jaypee’s Gujarat cement business.
The Gujarat operation consists of a 3.6 million tonne clinker plant at Kutch in the western Indian state of Gujarat and a grinding plant with the capacity to produce 2.4 million tonnes a year.
In July CRH was reported to be eyeing an expansion in India and was said to be in a race with Ultra Tech Cement, India’s main cement maker, to buy two plants owned by Jaiprakash Associates.
Jaiprakash plans to raise up to $1.6 billion (€1.3 billion) from the sale of the two cement plants in the Gujarat and Andhra Pradesh states to help pay down part of its $8 billion debt.
On Monday India’s Economic Times reported that CRH, the Iseq index heavyweight, was close to picking up a 51 per cent stake in Jaiprakash Associates’ cement operations in Gujarat.
The Jaypee Group is a diversified infrastructure conglomerate based in Noida, India. It was founded by Jaiprakash Gaur in 1979, and has business interests in engineering, construction, energy, cement, real estate and hospitality.
CRH entered the Indian market in 2008 through a joint-venture with cement manufacturer My Home Industries.
In June CRH said it had spent €250 million in the first half of the year on 18 acquisition and investment initiatives.
Shares in CRH were up 1 per cent at €15.65 yesterday morning on the Irish Stock Exchange.
Shares in Jaiprakash Associates were up 2 per cent at 77.55 rupees on the National Stock Exchange. – (Additional reporting: Reuters)