India’s Adani Enterprises calls off $2.5 billion share sale

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India’s Adani Enterprises has called off its $2.5 billion share sale due to prevailing market conditions, the company said on Wednesday. “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.

The board of directors of the company on Wednesday decided not to proceed with the fully subscribed FPO, citing the interests of its subscribers in a media release, and added that the proceeds received will be returned to the investors. The board also thanked the investors for the support to the FPO.

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,” the statement said.

“Our balance sheet is very healthy with strong cashflows and secure assets, and we have an impeccable track record of servicing our debt. This decision will not have any impact on our existing operations and future plans,” he added.

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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.

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