Key Highlights of the Deal
- ABREL (Aditya Birla Real Estate Limited) sells Century Pulp & Paper (CPP) to ITC in a slump sale.
- Deal valued at ₹3,498 crore, subject to regulatory approvals.
- Move allows ABREL to focus on core real estate business expansion.
- ITC gains strategic asset to boost its paperboard and specialty papers business.
Why ABREL is Exiting the Pulp & Paper Business
Aditya Birla Real Estate Limited (ABREL) the real estate arm of the Aditya Birla Group has decided to divest its pulp and paper business to ITC Ltd for ₹3,498 crore. The sale includes Century Pulp and Paper (CPP) located in Lalkuan, Uttarakhand, as part of a value-unlocking strategy for shareholders.
R.K. Dalmia, Managing Director of ABREL, stated:
“The company is entering a transformational growth phase, and this move will sharpen its focus on real estate to drive long-term value creation.”
He also praised CPP’s strong performance and sustainability record, expressing confidence in ITC as the right buyer to take the business forward.
ITC’s Strategic Expansion in Paper Business
ITC, a diversified conglomerate with a strong presence in FMCG, hotels and paperboards, sees this acquisition as a key step in scaling its paper manufacturing capabilities.
The company stated:
“This acquisition aligns with our strategy to expand capacity in the paperboards and specialty papers segment, given limited expansion options at existing facilities.”
Financial Performance of CPP (Century Pulp & Paper)
- 9MFY25 Revenue: ₹2,382.5 crore (↓5.34% YoY)
- FY24 Revenue: ₹3,375.32 crore (↓5.5% YoY)
Despite declining revenues, ITC sees long-term potential in CPP’s established operations.
ABREL’s Growing Real Estate Business
With this divestment, ABREL aims to strengthen its real estate portfolio, which has shown strong growth in recent years:
Real Estate Financials
- 9MFY25 Revenue: ₹777.71 crore (↑5x YoY)
- FY24 Revenue: ₹832.21 crore (↑6x YoY)
Key Residential Projects
- Birla Arika (Gurugram): Sold homes worth ₹3,000 crore.
- Pune Project: Recently launched, with ₹2,700 crore revenue potential.
- Total Ongoing Projects GDV: ₹14,980 crore
- Upcoming Projects GDV: ₹48,367 crore
ABREL is expanding in Mumbai, Bengaluru, NCR, and Pune through outright land purchases and asset-light joint ventures.
Deal Timeline & Approvals
- Expected Completion: Within 6 months
- Regulatory Approvals Needed:
- Competition Commission of India (CCI)
- Other statutory clearances
Financial Advisors: JM Financial Limited
Legal Advisors: AZB & Partners
Final Thoughts
This deal marks a strategic shift for ABREL, allowing it to focus entirely on real estate growth, while ITC strengthens its paper manufacturing footprint. The transaction is expected to close by late 2025, pending approvals.