India's leading conglomerates, JSW and the Aditya Birla group's UltraTech lost the race to acquire Ambuja Cements due to the potential delays in getting Competition Commission of India"s approvals by the existing cement companies, CEO of Swiss cement major, Holcim, Jan Jenisch indicated to analysts.
JSW Chairman Sajjan Jindal had said he offered $7 billion to acquire Holcim's 63 per cent stake in Ambuja. UltraTech had bid higher than JSW, said a Birla group insider. But UltraTech had proposed to sell close to 12-15 mtpa of capacity which would have led to a delay of closing the transaction by 18 months.
"This goes from indemnifications all the way, of course, to approval process by the Competition Commission of India, which is a very proper commission of course, so it is not in our interest here to engage may be with competitive
companies and then, you are hanging in there and you have a very lengthy process. So, that was another consideration," Jenisch said in a conference call.
The transaction was in the making for the last three months, he said.
"We are happy that we found a solution where we could get the smoothest possible execution of this agreement, he added.
The only condition precedent to the deal is the approval of the Competition Commission of India for Adani transaction.
"This has nothing to do with any potential litigation, this is a standard process, you have that in the European Union (EU), you have that in the United Statea, and as you mentioned already, as Adani doesn’t have building materials in its portfolio today, it is expected that this will be a very fast approval," he said.