JPAssociates rallies 14% on sale of cement business

NEW DELHI: Jaiprakash Associates rallied by over 14 per cent in morning trade on Friday, after the company announced part sale of its cement business to the Kumarmangalam Birla-led Ultratech for Rs 15,900 crore, marking the biggest consolidation in the cement sector.

At 09:40 am; Jaiprakash Associates was trading 14 per cent higher at Rs 8.72. It hit a low of Rs 7.8 and a high of Rs 8.75 so far in trade.

The size of the deal announced last month has been reduced from Rs 16,500 crore as Jaiprakash Associates Ltd (JAL) decided not to sell its cement plant in Karnataka with a capacity of 1.2 million tonnes per annum (MTPA).

The deal will help JP Associates reduce its debt, which runs into thousands of crores of rupees.

The transaction is subject to various regulatory approvals including stock exchanges, Competition Commission of India, shareholders and creditors as well as sanction of scheme of arrangement by High Courts of Mumbai and Allahabad.