Finshots Daily Making sense of Aditya Birla's breakup with the paper business
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Apr 5, 2025 Aditya Birla Real Estate has decided to divest its pulp and paper business to ITC, marking a significant shift from its cotton-centric roots. The discussion dives into the challenges facing the paper industry and the strategic focus on real estate. It also addresses how this transition could unlock new market opportunities and reflects on the implications for both companies amidst India's changing FMCG landscape and regulatory environment. A fascinating look at corporate strategy and industry dynamics!
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Cotton Crisis & Century's Rise
- The American Civil War halted cotton production in the US, impacting global supply.
- This led to the creation of the Century Spinning and Manufacturing Company to meet the demand.
ABRL's Streamlining Strategy
- Aditya Birla Real Estate (ABRL) is streamlining its business by focusing on core strengths.
- They are selling off their pulp and paper business to ITC.
Previous Sale Attempts
- ABRL tried selling its paper business to ITC in 2015 and JK Paper in 2017.
- Valuation disagreements stalled these deals.