New Delhi: India’s Adani Enterprises called off its $2.5 billion share sale on Wednesday, citing market conditions, amid an ongoing rout in the wider Adani Group’s stocks which was sparked by a U.S. short-seller’s critical report.
“Given the unprecedented situation and the current market volatility the Company aims to protect the interest of its investing community by returning the FPO proceeds and withdraws the completed transaction,” the company said in a statement.
Shares in Indian billionaire Gautam Adani’s conglomerate plunged, driving the value of his companies $86 billion lower, with the tycoon also losing his crown as Asia’s richest person.
“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,” Adani said.
“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 in a statement.
The withdrawal marks a stunning setback for Adani, the school dropout-turned-billionaire whose fortunes rose rapidly in recent years in line with stock values of his businesses.
Adani, whose business interests span ports, airports, mining, cement and power, is battling to stabilise his companies and defend his reputation.
Adani Group had on Tuesday mustered enough support from investors for the share sale for Adani Enterprises to proceed, in what some saw as a stamp of investor confidence.
But after a brief respite the selloff in Adani Group stocks and bonds resumed on Wednesday, with shares in Adani Enterprises plunging 28% and Adani Ports and Special Economic Zone dropping 19%, the worst day on record for both.
(Reporting by Aditya Kalra and Jahnavi Nidumolu in Bengaluru; Editing by Anil D’Silva, Kirsten Donovan and Alexander Smith)
Disclaimer: This report is auto generated from the Reuters news service. ThePrint holds no responsibilty for its content.
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