Indian billionaire Gautam Adani has broken his silence and defended his industrial empire despite the cancellation of a $2.4 billion stock sale after a short seller attack.
It loses Adani Group Shares rose to $100 billion on Thursday after the conglomerate’s flagship company halted its share issuance, saying it was “morally wrong” to continue given the stock write-off.
In a video address released shortly before the markets opened, founder Adani dismissed concerns about the group’s finances, saying the decision to forego raising funds for Adani Enterprises “will have no impact on our current operations and future plans.”
He said the sale was halted to protect investors, who would otherwise face serious losses due to a drop in the company’s value after signing the deal.
“For me, the interest of my investors comes first [else] is secondary,” Adani said in the company’s appeal. “That’s why we withdrew to protect investors from potential losses [sale].”
The group’s chairman said the company’s earnings and cash flow were “very strong” and it had an “impeccable track record of meeting our debt obligations”.
“Our balance sheet is healthy and active, solid,” Adani said. “Once the market stabilizes, we will review our capital market strategy.”
Adani Group shares have now lost Rs 8.4 trillion ($102 billion) after short-seller Hindenburg Research last week accused the conglomerate of using offshore entities in tax havens to inflate the share prices of listed companies. “placing the entire group in a precarious financial position”. “Adani Group” denied the allegations.
Shares of all 10 listed companies controlled by the conglomerate fell in early trade in Mumbai on Thursday, but some recovered later. Adani Enterprises fell more than 18 percent, while both Adani Transmission and Adani Ports fell 10 percent.
Decision on Wednesday pull stock sales and pay back investors It came after shares of Adani Enterprises fell to Rs 2,179.75 ($27), well below the deal price of Rs 3,112.
On Thursday, several Indian opposition lawmakers demanded that Parliament set aside time to debate Hindenburg’s claims. Adani Group’s investors include government agencies such as Life Insurance Corporation of India and State Bank of India.
Adani made repeated efforts to reassure investors leading up to the share sale, including releasing a 413-page response to the short seller’s claims. That too It involved some of India’s leading tycoons helping you get the next offer down the line.
Leading investors, including Abu Dhabi’s International Holding Company and London-listed Jupiter Asset Management, had committed to buy 30 percent of the offering before the public share sale began on Friday. IHC on Monday He promised to invest 400 million dollars on sale.
The sale prompted some financial groups, including Citigroup’s wealth division, to stop accepting Adani securities as collateral for margin loans, according to a person with direct knowledge of the situation.
Adani Group on Thursday also denied “market rumours” that shares in cement-making equipment Ambuja Cements and ACC had been pledged as part of the acquisition financing, and that the group was under pressure to cover losses caused by falling share prices.
Adani Group debt was also affected by the sell-off, with a dollar bond from Adani Ports due in 2024 falling 20 cents to just under $0.70 on the dollar on Wednesday, while another from Adani Green Energy due in 2024 the bond fell about 10 cents to $0.67. dollar.
