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Adani Cement Secures $3.5 Billion Loan to Support Ambuja and ACC Acquisition

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Adani Cement has successfully secured a massive $3.5 billion loan from international banks to refinance the debt it took on when it acquired Ambuja and ACC. This demonstrates the company’s financial strength and its ability to access global financial markets. The loan will save Adani Cement around $300 million in costs and is part of their plan to reduce debt.

Adani Cement, the second largest cement company in India, made a historic $6.6 billion acquisition of Ambujahttps://www.adani.com/businesses/materials and ACC in September 2022. Now, they’ve managed to secure a $3.5 billion loan from international banks to refinance the debt related to this acquisition.

What’s impressive is that the loan’s term is three years, which means Adani Cement has the trust and support of these banks. It also highlights the company’s strong financial position.

This refinancing will save Adani Cement approximately $300 million in costs. They are committed to maintaining financial stability and growth, and this deal is a significant step in that direction.

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The strong financial performance of Ambuja and ACC, with an improvement in earnings (EBITDA) per ton, demonstrates the success of the acquisition. EBITDA per ton increased from INR 340 in the quarter ending September 2022 (right after the acquisition) to INR 1,253 in the quarter ending June 2023.

The loan was made possible with the help of 10 international banks, including DBS Bank, First Abu Dhabi Bank, Mizuho Bank, MUFG Bank, Barclays Bank PLC, BNP Paribas, Deutsche Bank AG, ING Bank, Sumitomo Mitsui Banking Corporation, and Standard Chartered Bank.

This financial move aligns with Adani Cement’s plan to gradually reduce its debt, with its net debt-to-EBITDA ratio now below 2x.

Adani Cement’s acquisition of Ambuja and ACC has significantly increased its production capacity, and with the addition of Sanghi Cement, they are on track to reach 100 million tons per annum by 2025. The synergies between Adani’s infrastructure and the cement companies are driving positive changes, resulting in higher profitability.