Ahmedabad (Gujarat) [India], February 1 (ANI): The Board of Adani Enterprises Ltd (AEL) has decided not to go-ahead with the fully subscribed Follow-on Public Offer (FPO). The company said in a release that given the unprecedented situation and the current market volatility, it “aims to protect the interest of its investing community by returning the FPO proceeds and withdraws the completed transaction”.
Gautam Adani, Chairman, Adani Enterprises Ltd referred to the volatility in the stock over the last week and said the interest of the investors is paramount and to insulate them from any potential financial losses, the Board has decided not to go ahead with the FPO.
“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. Thank you,” he said.
“However, today the market has been unprecedented, and our stock price has fluctuated over the course of the day. Given these extraordinary circumstances, the Company’s board felt that going ahead with the issue will not be morally correct. The interest of the investors is paramount and hence to insulate them from any potential financial losses, the Board has decided not to go ahead with the FPO,” he added.
Gautam Adani said company’s balance sheet is very healthy with strong cashflows and secure assets.
“We are working with our Book Running Lead Managers (BRLMs) to refund the proceeds received by us in escrow and to also release the amounts blocked in your bank accounts for subscription to this issue,” he 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,” he added.
Shares of Adani Enterprises nosedived sharply on Wednesday, a day after its follow-on public offer closed for the subscription. The shares of Adani Group flagship company closed at Rs 2,179.75 with a sharp decline of 26.70 per cent. Its intraday low was Rs 1,941.2, over 30 per cent lower than Tuesday’s settlement price.
On Tuesday, the last day for subscription, the follow-on public offer (FPO) issued by Adani Enterprises was fully subscribed. A follow-on public offering (FPO) is the issuance of shares to investors by a company listed on a stock exchange after its initial public offerings.
Data showed the demand for the FPO was led by non-institutional investors, and they subscribed to the shares 3.26 times. The portion for institutional investors was also oversubscribed. On Monday, an Abu Dhabi-based diversified conglomerate International Holding Company announced that it will invest about USD 400 million (AED 1.4 billion) into the Adani Enterprises’ follow-on public offer (FPO) through its subsidiary Green Transmission Investment Holding RSC Limited.
Adani Enterprises had filed a red herring prospectus with the markets regulator Securities and Exchange Board of India (SEBI) for the Rs 20,000 crore follow-on public offer (FPO), the largest ever in India.
There were concerns that the FPO may not receive a strong response from investors amid a report by a US-based Hindenburg Research that surfaced on January 24, which claimed the Adani Group of having weak business fundamentals among others.
The US-based firm, in its report, raised concerns about shares of Adani group companies having a possibility of declining from their current levels, owing to high valuations. In response, Adani Group on Sunday said the recent report by Hindenburg Research was not an attack on any specific company but a “calculated attack” on India, its growth story, and ambitions. It added the report was “nothing but a lie”. (ANI)
“Interest of my investors is paramount…”Gautam Adani’s first response after calling off Rs 20,000 crore FPO
New Delhi [India], February 2 (ANI): A day after deciding not to go-ahead with the fully subscribed Follow-on Public Offer (FPO), Adani Enterprises Ltd chairman Gautam Adani on Thursday said it would not be “morally correct” to go ahead with the Rs 20,000-crore share in the current market condition.
“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 his address to investors after withdrawal of the fully subscribed FPO.
Adani said in his 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,” he said.
This decision, he said “will not have any impact on our existing operations and future plans. We 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 EBIDTA levels and cash flows have been very strong and we have an impeccable track record of fulfilling our debt obligations. We will continue to focus on long term value creation and growth will be managed by internal accruals,” Adani said.
“Once the market stabilizes, we will review our capital market strategy,” he said.
“We have a strong focus on ESG and every business of ours will continue to create value in a responsible way. The strongest validation of our governance principles, comes from several international partnerships we have built across our different entities,” Adani said. “I take this opportunity to thank our investment bankers, institutional investors and shareholders from within and outside the country for giving unflinching support to the FPO.”
Thanking investors, he said, “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.” Shares of Adani Enterprises nosedived sharply on Wednesday, a day after its follow-on public offer closed for the subscription. The shares of Adani Group flagship company closed at Rs 2,179.75 with a sharp decline of 26.70 per cent. Its intraday low was Rs 1,941.2, over 30 per cent lower than Tuesday’s settlement price. On Tuesday, the last day for subscription, the follow-on public offer (FPO) issued by Adani Enterprises was fully subscribed.
A follow-on public offering (FPO) is the issuance of shares to investors by a company listed on a stock exchange after its initial public offerings. Data showed the demand for the FPO was led by non-institutional investors, and they subscribed to the shares 3.26 times. The portion for institutional investors was also oversubscribed. On Monday, an Abu Dhabi-based diversified conglomerate International Holding Company announced that it will invest about USD 400 million (AED 1.4 billion) into the Adani Enterprises’ follow-on public offer (FPO) through its subsidiary Green Transmission Investment Holding RSC Limited.
Adani Enterprises had filed a red herring prospectus with the markets regulator Securities and Exchange Board of India (SEBI) for the Rs 20,000 crore follow-on public offer (FPO), the largest ever in India. There were concerns that the FPO may not receive a strong response from investors amid a report by a US-based Hindenburg Research that surfaced on January 24, which claimed the Adani Group of having weak business fundamentals among others.
The US-based firm, in its report, raised concerns about shares of Adani group companies having a possibility of declining from their current levels, owing to high valuations. In response, Adani Group on Sunday said the recent report by Hindenburg Research was not an attack on any specific company but a “calculated attack” on India, its growth story, and ambitions. It added the report was “nothing but a lie”. (ANI)
