JSW Cement Board Approves Merger With Shiva Cement

Merger Details

JSW Cement will merge with its listed subsidiary Shiva Cement to create a single unified cement platform. The board of JSW Cement approved a scheme of arrangement for the amalgamation in a late-night filing on Tuesday. Under the approved swap ratio, JSW Cement will issue 5 equity shares of face value 10 rupees for every 41 equity shares of face value 2 rupees held in Shiva Cement.

Approvals and Timeline

The transaction requires approvals from stock exchanges, SEBI, the National Company Law Tribunal, the Odisha Industrial Infrastructure Development Corporation, and other statutory authorities, along with shareholders and creditors. The entire process is expected to take 12 to 14 months. Meanwhile, shares of JSW Cement were trading at 112.85 rupees on the BSE, up 0.22 percent from the previous close.

Business Benefits

JSW Cement currently holds a 66.23 percent share in Shiva Cement, having first acquired a 37 percent stake in January 2018 alongside an open offer. The combined entity will feature a cement grinding capacity of 24.10 million tonnes per annum and a clinkerisation capacity of 9.74 million tonnes per annum. Company CEO Nilesh Narwekar stated that the merger will unlock operational and financial synergies, strengthen backward integration through Shiva Cement's clinker facility, and simplify the corporate structure.

Context

Corporate mergers in the heavy manufacturing sector often aim to streamline operations and reduce supply chain costs by bringing key production facilities under one roof. Such restructuring helps companies pool resources and improve financial flexibility while dealing with regulatory and market demands.