Cement, Energy and Environment

in the deal as of now," a source said requesting anonymity. "The deal (with Cemex) is in the doldrums, first because Murli has been seeking higher valuation. In fact, most of the sellers are asl<ing for 80 - 100% as the last 2-3 deals happened at the valuation," said one person. "But that is not the benchmark and assets also need to be considered. The last deal where France Based Vicate SA paid $220 per tonne to Hyderabad-based Bharathi Cement happened because the plant is new and there is a possibility of expansion; also, it has good limestone reserves. Murli's limestone reserves are not of that great quality and you cannot take , it out of Maharashtra. Also, the plant is not new. So, seeking the same kind of valuation is not fair," this person said. Murli is separately trying to put up two more plants in Rajasthan and Karnataka, which it will run on its own , the sources said. An analyst from a domestic brokerage said, "International companies are quite sceptical of forging tie-ups with tainted companies and Sebi's order insider trading will impact the deal in a negative way." A senior industry expert who did not wish to be identified said Cemex has been aggressively seeking an Indian entry since early this year, though nothing has fructified yet. The Mexican giant had offered around $150.3 per tonne to South based Penna Cements, which it was courting in July; but Prathap Reddy, promoter of Penna Cements, declined the offer. Hyderabad-based Penna has an existing cap.acity of 4.7 million tonne and caters to markets in Karnataka, Andhra Pradesh, Tamil Nadu and Goa. Emails sent to Cemex and Murli Industries remained unanswered, as did calls to a senior official of Murli group. The world average for consumption of cement is close to 5 per cent, whereas Indian consumption is at 8 per cent. To add to it, developed countries are stagnating. Even in India, the cement industry grew only 5 per cent for first half of 2010-11 compared with 10 per cent last year, which is expected to put pressure going further. Major developed markets have been in stagnation for years now, while a few are fast degenerating (US grew 1 per cent, Japan declined 1 per cent and Russia declined 4% in the last 15 years). The average payout for deals between 2005 and 2008 was around $168 per tonne as against $121 per tonne a decade before. Courtesy: DNA Mumbai, 14.12. 2010. DALMIA TO SET UP CEMENT UNITS IN MEGHALAYA, KARNATAKA Dalmia Cement plans to set up two new cement units, with a capacity of 2.5 million tonnes each, in Meghalaya and Karnataka, expected to go on stream within two-and-a-half years. The company will pump in Rs. 2,500 crore, of which Rs. 600 crore is internal accrual. The rest of the funding will be tied up in two years. "We want to be a pan-India player. So, to begin with, we planned to go deep in the east and south," said Puneet Dalmia, Managing Director of Dalmia Bharat Enterprises. With commissioning of the new units, the group's total cement making capacity will reach 19.3 million tonnes from the existing 14.3 million tonnes . This will catapult the company among the large players of the industry. Of the existing capacity, Dalmia owns 9 million tonnes, while OCL India, in which the Dalmia group has 45 per cent equity, has 5.3 million tonnes of capacity. Courtesy: The Business Standard New Delhi, 04.12.2010. ULTRA TECH, BINANI LIKELY TO SET UP UNITS AT DIGHI PORT Following Jaypee Cement's plans to set up a 3 million tonne cement grinding plant in the port area of the upcoming Dighi Port in Raigad district of Maharashtra, Aditya Birla Group company Ultra Tech and Binani Cement are in talks with port developers to set up grinding and packaging plants there, sources close to the development said. Courtesy: The Financial Express Mumbai, 06.12.2010. Merger & Acquisition J .....___ __ HOLCIM TAKES CREEPING ROUTE TO HIKE STAKE IN ACC The world's second-largest cement maker Holcim Group has started strengthening its stake in its Indian subsidiary ACC through the creeping acquisition route for the first time after September 2008. 13