Aditya Birla group company UltraTech Cement today said it has formed a committee of directors to consider merging the cement business of the group with itself, for which it has received a proposal from Samruddhi Cement.
In a filing to the Bombay Stock Exchange UltraTech said its board found the proposal of Samruddhi Cement attractive and has "constituted and authorised a Committee of Directors and Officers of the company to evaluate and consider the proposal in consultation with legal and financial advisors".
The committee is expected to revert to the board with its recommendations by first week of November.
Aditya Birla Group, which had acquired UltraTech from engineering giant L&T in 2004, had planned to hive-off Grasim cement into Samruddhi, a wholly-owned subsidiary of Grasim Industries. The demerged entity would be listed and then merged with UltraTech.
Last week, Aditya Birla group company Grasim Industries said it would consolidate its cement businesses by merging Grasim cement with UltraTech, which together will have a capacity of 49 million tonnes per annum or 20 per cent of the country's cement production.
Post-merger (Samruddhi and UltraTech), Grasim's holding in the consolidated entity would be somewhere between 55 and 65 per cent. Grasim shareholders would hold 35 per cent in Samruddhi post demerger.
Shares of UltraTech closed at Rs 812.85, up 0.99 per cent on the BSE.