The government's approval of Holcim 's plan to restructure its India business has paved way for ACC to become a subsidiary of Ambuja Cements . In addition, the merger of Lafarge and Holcim is expected to save nearly $1.1 billion for Holcim. However, ACC and Ambuja Cements did not undertake major capacity addition as debt funding for expansion would have impacted the consolidated debt-equity ratio of their parent Holcim. The exercise is likely to benefit ACC more considering factors such as capacity addition plan over the next year, cost efficient operations, and a healthier balance sheet.In the past few years, ACC and Ambuja Cements were less aggressive in expanding capacities. Indian operations contribute nearly 16 per cent of the total capacity of Lafarge-Holcim.With the restructuring, ACC becomes a pure play cement company while Ambuja becomes its holding company which also has its own operations.

Source: Economic Times July 25, 2016 20:37 UTC