India: Reliance Infrastructure, part of Anil Ambani-led Reliance Group, has decided to sell its cement business, Reliance Cement, to fund the acquisition of Pipavav Defence and Offshore Engineering, which it is acquiring for US$331m.
Reliance Cement is in talks with HeidelbergCement and Italcementi and has offered a 50% stake in the company. The prospective joint venture partner will also fund the company's cement capacity expansion, which is estimated to rise to 15Mt/yr by 2018. Details of the valuation of the possible deal are unknown. HeidelbergCement has operations in Damoh in Madhya Pradesh, Jhansi in Uttar Pradesh and Ammasandra in Karnataka. Italcementi is active in India via Zuari Cement.
Reliance Cement has a 5Mt/yr capacity cement plant in Maihar, Madhya Pradesh. As part of its expansion plan, it is setting up another 5Mt/yr plant in Maharashtra, which is set to be operational by 2017. It is also planning another 5Mt/yr of capacity to be operational by 2018, via a second line in Madhya Pradesh, a new plant in Karnataka or a new plant in Rajasthan.