Ambuja Cement India Ltd to make public bid for ACC and Ambuja Eastern

Ambuja Cement India Ltd to make public bid shareholdings in The Associated Cement Companies Ltd and Ambuja Cement Eastern Ltd. Ambuja Cement India Ltd (ACIL) will be the alliance vehicle. Holcim has entered into an agreement with private investors (AIG/GIC) to acquire a 40 percent stake in ACIL, and has simultaneously entered into a Share Subscription Agreement with ACIL which will allow Holcim to raise its participation to 67 percent in ACIL.

In line with the objectives of the strategic alliance between GACL and Holcim, ACIL has announced a public purchase offer to acquire a majority shareholding in The Associated Cement Companies Ltd (ACC). ACIL already owns a 13.8 percent holding of ACC, India’s second-largest cement producer. Through ACIL, Holcim is offering ACC shareholders Rs370 per share with the objective of increasing its shareholding up to 50.01 percent. The tender offer is subject to the approvals by the relevant government authorities in India.

ACIL also owns 94 percent of Ambuja Cement Eastern Ltd (ACEL), which is one of the most profitable cement manufacturers in India. Concurrently, ACIL is also making an offer to the minority shareholders of ACEL at Rs70 per share, subject to the relevant approvals. The transactions are expected to be concluded by April 2005 with Holcim expected to invest a total of approximately US$800m which will be financed entirely through internal resources and existing credit facilities. Holcim firmly believes that the strategic alliance with GACL will be of significant advantage to both partners, particularly since GACL ranks among India’s leading cement producers and Holcim is one of the global cement market leaders. Holcim’s decision to enter the Indian market represents another major milestone for India’s cement industry and is also in line with the government’s declared objective of developing an efficient and internationally competitive cement industry.