India’s Adani Enterprises on Wednesday called off its $2.5 billion (Rs 20,000 crore) share sale due to prevailing market conditions, the company said in a statement. It comes days after the company’s stocks took a beating following criticism by American short-seller Hindenburg Research.
“The Board of Directors of the Company at its meeting held today i.e. February 1, 2023, has decided, in the interest of its subscribers, not to proceed with the further public offer (FPO) of equity shares aggregating up to Rs 20,000 crore of face value Rs 1 each on partly paid-up basis, which was fully subscribed,” the company said in an exchange filing.
“Given the unprecedented situation and the current market volatility the company aims to protect the interest of its investing community by returning the FPO proceeds and withdraws the completed transaction,” said in a statement.
“The Board takes this opportunity to thank all the investors for your support and commitment to our FPO. The subscription for the FPO closed successfully yesterday. Despite the volatility in the stock over the last week, your faith and belief in the company, its business and its management has been extremely reassuring and humbling, ” Gautam Adani, Chairman, of Adani Enterprises Ltd said.
The company said they are working with their Book Running Lead Managers (BRLMs) to refund the proceeds received by them in escrow and to also release the amounts blocked in the client’s bank accounts for subscription to this issue.
According to the statement, the company said: “Our balance sheet is very healthy with strong cashflows and secure assets, and we have an impeccable track record of servicing our debt. This decision will not have any impact on our existing operations and future plans. We will continue to focus on long term value creation and growth will be managed by internal accruals. Once the market stabilizes, we will review our capital market strategy. We are very confident that we will continue to get your support. Thank you for your trust in us.”
American short-selling firm Hindenburg Research released a report last week accusing the Adani group of engaging in “decades of stock manipulation and accounting fraud”.
Also, Read: India’s Adani Group loses $65 billion in three days
The Adani Group on Sunday said the company had published a 413-page statement saying it was a “malicious” attack and denied Hindenburg’s claims. The group said the allegations made by Hindenburg were “nothing but lies”.
“This is not just an unwarranted attack on the company, but an attack on India as a whole, on the independence, integrity and quality of Indian institutions, and on India’s development and ambitions,” the group said in a statement.
New York-based short seller Hindenburg Research has responded to Adani Group’s 413-page riposte, saying “fraud cannot be obfuscated by nationalism or a bloated response that ignores every key allegation it originally raised”. The firm said that it believed India was a vibrant democracy and an emerging superpower with an exciting future and it was Adani Group which was holding it back through “systematic loot”.
A global media for the latest news, entertainment, music fashion, and more.
