Competition Commission clears ITC proposal to acquire ABREL's Century pulp paper biz for Rs 3,498 cr

New Delhi: Fair trade regulator CCI on Tuesday cleared conglomerate ITC Ltd's proposal to acquire the pulp and paper business of Aditya Birla Real Estate Ltd (ABREL) for Rs 3,498 crore.

The development came after ABREL in March this year announced that its board has approved the execution of the business transfer agreement for the divestment of the pulp and paper undertaking situated in Lalkuan, Uttarakhand, by way of a slump sale to ITC.

The Competition Commission of India (CCI) said it has approved the proposed deal.

"Commission approves acquisition of paper and pulp manufacturing business of Aditya Birla Real Estate Limited by ITC Limited," the regulator said in a post on X.

Established in 1984 at Lalkuan (Nainital, Uttarakhand), pulp and paper undertaking Century Pulp and Paper (CPP) of ABREL is a well-established player in the Indian paper industry with an installed capacity of 4.8 lakh metric tonnes per annum.

In March, ABREL said, "The transfer of the business will be for a lump-sum cash consideration of Rs 3,498 crore, to be paid by ITC to ABREL."

The divestment of the pulp and paper undertaking is a value-unlocking exercise. It will further enable the company to pursue growth opportunities in its core business - real estate, the company added.

Kolkata-headquartered ITC has said its paperboards and packaging segment is expected to continue generating free cash flow going forward. During FY20-24, the segment generated a free cash flow of RS 4,000 crore.