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MUMBAI (Reuters) – Indian billionaire Gautam Adani’s $2.5 billion stake sale neared full tender on Tuesday.
A secondary stake sale in flagship Adani Enterprises (ADEL.NS) took 85% on Tuesday, including the anchor investor portion, Indian stock exchange data showed. A minimum of 90% subscription is required for the stock sale to be completed.
By Monday, the bookbuilding process for the nation’s largest stock sale had received just 3% of the bid.
Shares of Adani Group plunge after Jan. 24 report from US-based Hindenburg Research voiced concerns over high debt levels and use of tax havens, with cumulative losses now at $65 billion has reached Adani calls the report baseless.
The stock sale is important to Adani. Not only because it is India’s largest additional public offering and helps reduce debt, but its success is seen as a sign of investor confidence at a time when the tycoon faces his biggest. It’s from Recent business and reputation challenges.
The group has repeatedly spoken out in recent days amid growing fears that investors are backing the company and that a public offering may not materialize. Bankers had at one point considered fine-tuning the issue price or extending the sale, according to Reuters.
Support for Adani’s share sale rose nearly 4%, even though the flagship’s shares were trading at Rs 3,002, but remained below the lower end of the share sale price range of Rs 3,112.
“With only a few hours left until the final day, it looks like the wire transfer will take place, but the sale should go through. seems to be doing,” said founder Dipan Mehta. Director of Elixir Equities.
Over the weekend and into Monday, Adani’s firm held extensive discussions with investment bankers and institutional investors to win the subscription.
Demand from retail investors remained low, with bids representing only about 9% of the segment’s offerings. Data on Tuesday showed demand from foreign institutional investors and companies with bids above Rs 1 crore each.
Abu Dhabi-based conglomerate International Holding Company (IHC.AD) said it would invest $400 million in the issuance.
VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said:
The Hindenburg Report and its impact have captured the world’s attention. Adani is now the eighth richest person in the world, down from his third spot on last week’s Forbes rich list.
Global index publisher FTSE Russell said Tuesday it continues to monitor public information about the group, particularly from Indian regulators.
Hindenburg said in a report that it had shorted Adani Group’s US Treasuries and derivatives traded outside India. On Tuesday, US dollar-denominated bonds issued by Adani Ports and Special Economic Zone continued their decline for the second week in a row.
Reported by M. Sriram and Chris Thomas. Edited by Aditya Kalra and Muralikumar Anantharaman
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