Home / Companies / News /  Withdrew FPO to insulate investors from potential losses: Adani

Mumbai: Billionaire Gautam Adani on Thursday said that his group's flagship firm Adani Enterprises withdrew its 20,000 crore share sale to insulate investors from potential losses. 

The embattled firm late on Wednesday called off the follow on public offer (FPO) as allegations by Hindenburg Research trigged a rout in Adani Group stocks wiping off billions in market value.

“After a fully subscribed FPO, yesterday’s decision of its withdrawal would have surprised many. But considering the volatility of the market seen yesterday, the board strongly felt that it would not be morally correct to proceed with the FPO," Adani said in a statement.

On Wednesday, shares of Adani Enterprises tanked nearly 29%, dealing a massive blow to institutional investors and family offices that rescued the offer on the last day of the FPO. 

In early deals on Thursday, shares of Adani Enterprises were down 4.74% at 2,027.10 apiece, compared to the FPO issue price of 3,276, at the upper end of the price band.

“In my humble journey of over four decades as an entrepreneur I have been blessed to receive overwhelming support from all stakeholders particularly the investor community. It is important for me to confess that whatever little I have achieved in life is due to the faith and trust reposed by them. I owe all my success to them. For me, the interest of my investors is paramount and everything is secondary. Hence to insulate the investors from potential losses we have withdrawn the FPO," Adani said.

Adani said that the decision will not have any impact on existing operations and future plans and the group will continue to focus on timely execution and delivery of projects.

“The fundamentals of our company are strong. Our balance sheet is healthy and assets, robust. Our Ebitda levels and cash flows have been very strong and we have an impeccable track record of fulfilling our debt obligations," he said.

The group will continue to focus on long term value creation and growth will be managed by internal accruals, as per the statement.

“Once the market stabilizes, we will review our capital market strategy," said Adani.

In a separate statement, the group said that its promoters have not pledged any shares of Ambuja Cement or ACC.

“We have come across reports from various market sources with respect to Ambuja and our subsidiary ACC Ltd (ACC) claiming that shares of both Ambuja and ACC are pledged by promoters as a part of the acquisition financing. Consequently, there are market rumors that amid market volatility, there is a requirement to meet the top-up triggers where in there is selling pressure," as per the statement.

“We would like to clarify that none of the shares of Ambuja or ACC have been pledged by promoters. The promoters have only provided non-disposal undertaking and accordingly, there is no requirement of providing any top-up of shares of Ambuja and ACC or cash top up under the acquisition financing raised last year," it added.

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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