The slump continued on Wednesday for India’s Gautam Adani’s Adani Enterprises, with its stock plunging nearly 30% on the Bombay Stock Exchange, prompting it to announce late night the cancellation of a major share sale that, without However, he had been successful. . Adani, out of the top 10 of the world’s great fortunes established by Forbes in a few days, was forced to withdraw from a public offer for the sale of shares of 2,500 million dollars, which he had just launched.
The group’s board of directors issued a belated press release explaining that it had “decided, in the interest of the underwriters, not to proceed” with the so-called “follow-on” public offering (FPO). Subscribers will be reimbursed. The flagship stock of conglomerate Gautam Adani had unscrewed 28.45% to 2,128.70 rupees ($26) on the stock market on Wednesday.
plummeting fortunes
According to the Bloomberg agency, this collapse would be linked to the information that the Credit Suisse banking group had stopped accepting bonds from the Adani conglomerate as collateral for the margin loans it grants to its private banking clients. Asked by AFP, Credit Suisse declined to comment.
Meanwhile, Adani’s personal fortune has shrunk by more than $40 billion, according to Forbes real-time rankings, knocking him out of the top 10 richest people in the world. He is now behind his compatriot Mukesh Ambani. Gautam Adani is no longer the richest man in Asia. After the fifth straight day of losses, the stock market crash has wiped out about $92 billion of the value of the conglomerate’s publicly traded companies since last week, according to Bloomberg News.
The title Adani Total Gas, in which the French giant TotalEnergies has a 37.4% stake, fell again by 10% and trading was suspended again. The further sharp drop in Adani Enterprises shares came a day after the success of the oversubscribed follow-on public offering (FPO) in the final hours before expiration.
tycoons to the rescue
FPO’s subscribers included tycoons Sajjan Jindal and Sunil Mittal, Bloomberg News reported, citing sources who spoke on condition of anonymity. The investments come from their personal funds and are not related to the publicly traded companies they manage, such as JSW Steel Ltd. and Bharti Airtel Ltd, those sources said, according to Bloomberg.
Sajjan Jindal has invested around $30 million, a source added. However, the amount of Sunil Mittal’s investment was not disclosed. The losses for Mr Adani’s conglomerate follow the publication last week by US investment firm Hindenburg Research of a report alleging “blatant stock market manipulation and a system of accounting fraud spanning decades.”
The conglomerate reacted on Sunday by claiming to be the victim of a “malicious” attack aimed at tarnishing its reputation and dubbing Hindenburg Research the “Madoff of Manhattan,” a reference to rogue American businessman Bernard Madoff. “This is not just an unwarranted attack on a specific company, but a calculated attack on India, the independence, integrity and quality of Indian institutions and India’s history of growth and ambition,” he responded in a lengthy statement. .
Gautam Adani, 60, has seen his empire grow at breakneck speed, with Adani Enterprises’ share price skyrocketing by more than 1,000% in the past five years. The tycoon made a fortune in ports and commodity trading. He now runs India’s third-largest conglomerate with interests ranging from coal mining and edible oils to airports and the media.
political proximity
Critics believe that close proximity to Gautam Adani and Prime Minister Narendra Modi, both from the state of Gujarat, helped the tycoon win deals and avoid proper regulatory scrutiny. Narendra Modi has not commented publicly since the publication of the Hindenburg report, which analysts say has damaged India’s image among foreign investors.
India’s opposition Congress party this week called for a “serious investigation” by the central bank and regulator into Adani’s business dealings following allegations by Hindenburg Research. Modi’s government chose to turn a blind eye to the illicit activities of his pet business group. ?” asked Congress.
Source: BFM TV
