Holcim deal may trip on RBI norm

MUMBAI: Even as Sebi is looking at complaints to protect the interests of minority shareholders in the multi-layered deal proposed by Swiss giant Holcim for its two Indian units Ambuja Cements and ACC, the deal may hit another roadblock with RBI, in a circular on July 4, making it clear that operating Indian companies owned or controlled by foreign entities cannot use internal accruals to make downstream investments .
The deal may not have been announced in its current form had the Swiss cement maker's advisors and bankers read RBI's circular, which came good 20 days before Holcim announced its plans to rejig its stake in ACC and Ambuja, said an analyst. However, investment advisor S P Tulsian doesn't see any flaw in the deal.
"There is nothing fundamentally wrong in the deal. Holcim is increasing an 11% stake in Ambuja at the same time its foregoing 20% stake in ACC. So, it's a fair deal," said Tulsian.