Nuvoco-Vadraj deal via insolvency route valued at up to Rs 3,000 crore

On Monday, Nuvoco announced it had emerged as the successful applicant for Vadraj Cement in the corporate insolvency resolution process but did not disclose the deal value

Nirma Group promoted Nuvoco Vistas Corp’s earlier shared plans to acquire Vadraj Cement through the insolvency route would entail a deal size of Rs 2800-3000 crore, said a company official on Wednesday.

 

On Monday, Nuvoco said it has emerged as the successful applicant for Vadraj Cement, in a corporate insolvency resolution process, without disclosing the deal value.

 

Company officials on Wednesday said that the deal will entail Rs 1800 crore towards the bid under the insolvency route and another Rs 1000-1200 crore as capital expenditure to refurbish Vadraj Cement’s assets.

 

Vadraj Cement, as of June, has admitted claims of worth Rs 8180.61 crore, from secured, unsecured and other operational creditors combined, according to documents available on the website. The company, formerly ABG Cements, was admitted to National Company Law Tribunal (NCLT) in 2024 for an insolvency process. 

 

 

The target entity’s existing facilities include a 3.5 MMTPA clinker unit in Kutch, Gujarat, and a 6 MTPA grinding unit in Surat, Gujarat, limestone reserves, and a jetty. However, these facilities are not operational at present.

 

On Monday, Nuvoco said a phased investment will be made, spread over 15 months towards the refurbishment of assets and to drive operational improvements across Vadraj Cement plants. The estimated target date to commence production is around the third quarter of FY27, subject to approvals, said Nuvoco.

 

At present, Nuvoco operates 25 million tonnes per annum (MTPA) of cement capacity, which will increase to approximately 31 MTPA, up 20 per cent, with this transaction.

 

Nuvoco is promoted by Niyogi Enterprise, an investment vehicle of the Nirma Group. The transaction, Nuvoco earlier said, will be implemented by a wholly-owned subsidiary of Nuvoco and intends to fund the transaction without a significant rise in its consolidated debt levels.