On Breakingviews: Friendly investors pulled Gautam Adani's $2.4 billion share sale over the line. That'll be hard to repeat. Adani group faces refinancing pain and possible pressure from domestic regulators. It all acts as a brake on growth, says ugalani
, and Adani Ports still trade at distressed levels near 70 cents on the dollar. Meanwhile, accountants affiliated with EY Global and Deloitte may take a closer look at Adani’s books. The industrialist will also probably have to wait before trying again to diversify the tight shareholding structure of his other listed companies..
and IHC, which picked up 16% of the share sale, may chip in. But to the extent Gautam Adani was counting on debt and equity capital markets to fuel his growth, Hindenburg’s attack may leave lasting scars.The $2.4 billion share sale by Adani Enterprises was fully subscribed on Jan. 31, data released by the Indian stock exchange showed.
Investors bid for 1.12 times the shares on offer. Large non-institutional investors submitted bids for almost five times the shares offered or reserved to them, while employees bid for 0.55 times and individual retail investors for 0.12 times. International Holding Company, the Abu Dhabi conglomerate, said a day earlier that it would be investing 1.4 billion dirhams, over $380 million, to subscribe to 16% of the follow-on deal.
Shares of Adani Enterprises closed at 2,974 rupees on Jan. 31, up 2.8%, but about 4% below the bottom of the previously guided price range for the offering of 3,112 rupees.Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.
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