InvestorQ : Why has Ambuja Cement signed a NDU with ACC Ltd?
Anu Biswas made post

Why has Ambuja Cement signed a NDU with ACC Ltd?

Ria Jain answered.
2 months ago

As you are aware, ACC is currently a subsidiary of Ambuja Cements through its 50.5% holdings in ACC. With Adani (the buyer of majority stake in Ambuja Cements and ACC0 having pledged the entire stake to banks against loans taken, this NDU has been necessitated. Ambuja Cements has signed a non-dealing undertaking (NDU) on the 50.5% stake in ACC Ltd as collateral for loans taken by the company. It may be recollected that Adani had taken control of ACC and Ambuja by buying out the stake of Holcim.

Adani has aggressive plans to double the combined cement capacity of Ambuja and ACC from 70 MTPA to 140 MTPA by the year 2027. The entire acquisition of Ambuja and ACC from Holcim which entailed an outflow of over $7 billion was funded by the banks. The shares of ACC and Ambuja have been pledged as collateral to the Hong Kong branch of Deutsche Bank against loans against these loans in the form of a 63.5% encumbrance in Ambuja Cements and its 56.7% in ACC as pledge.