Home / Companies / News /  Regulator puts Adani Wilmar’s initial share sale on hold

Mumbai: The markets regulator has put the initial public offering (IPO) of Adani Wilmar Ltd on hold, according to the regulator’s website.

The Securities and Exchange Board of India (Sebi) said the issuance of observations on the Adani Wilmar draft prospectus has been kept in abeyance.

Sebi usually puts its approval for a draft prospectus in abeyance in case it needs more inputs from other regulatory bodies or if there are pending investigations against a company by Sebi or any other regulatory body or government authorities.

To be sure, Sebi did not specify the reason for putting the approval process of Adani Wilmar on hold.

In July, junior finance minister Pankaj Chaudhary told the Parliament that the securities regulator and customs authorities are investigating some Adani Group companies for non-compliance with rules.

Besides the Securities and Exchange Board of India, the Directorate of Revenue Intelligence, or DRI, is also “investigating certain entities" belonging to the Adani Group for compliance with another set of local laws, junior finance minister Chaudhary said in response to a lawmaker’s question in the Parliament, Bloomberg reported. Chaudhary didn’t elaborate on the investigations or name the Adani group companies being probed.

On 3 August, Adani Wilmar Ltd, the equal joint venture between Adani Enterprises Ltd and Wilmar International Ltd and the owner of the Fortune brand of edible oils, filed draft IPO documents for its proposed initial public offering.

“The proposed listing of Adani Wilmar on the stock exchanges will comprise an IPO in the form of a fresh issue of new equity shares by Adani Wilmar for an amount of up to 4,500 crore (approximately $600 million). There will not be any secondary offering," Adani Enterprises told the stock exchanges.

Mint was the first to report on the Adani group’s plans to take its fast-moving consumer goods (FMCG) joint venture with Wilmar public in March.

Adani said that the proceeds from the IPO are proposed to be used to fund capital expenditure for expansion of AWL’s existing manufacturing facilities and developing new manufacturing facilities; repayment/prepayment of borrowings; to fund strategic acquisitions and investments; and general corporate purposes.

Adani Wilmar has the largest range of edible oils comprising soya bean, sunflower, mustard and rice bran, among others. Its Fortune brand of oil has around 20% market share in India.

Adani spokesperson stated, “we have not received any formal communication from SEBI with respect to the IPO observations being kept in abeyance."

“As regards the query raised by you about the FPI, we would like to mention that we have communicated to media and public at large that the group has no connection with the FPIs, either directly or indirectly. However, unfortunately the media is repeatedly raising the issue time and again misleading the investing community. FPIs are investors like other investors/shareholders in Adani Group and act independently having no relationship with Adani Group," the spokesperson added.

"While we have always been fully complaint with applicable SEBI Regulations, we have made full disclosure to SEBI on specific information requests from them in the past. We will continue to co-operate with the regulators in the future as well." 

ABOUT THE AUTHOR

Swaraj Singh Dhanjal

" Based in Mumbai, Swaraj Singh Dhanjal is responsible for Mint’s corporate news coverage. For the past eight years he has been writing on the biggest deals in private equity, venture capital, IPO market and corporate mergers and acquisitions. An engineer and an MBA, he started his journalism career in 2014 with Mint. "
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