New Delhi:Adani Enterprises has decided not to proceed with its fully subscribed Follow-on Public Offer (FPO), the conglomerate said in a statement late on Wednesday, hours after the shares of the firm nosedived 28.45% to close at Rs 2,128.70 on the BSE.
Citing market volatility and “the unprecedented situation”, the company attributed its abrupt decision to a need to protect its investors by returning their proceeds.
“The Board takes this opportunity to thank all the investors for support and commitment to our FPO,” Adani Enterprises chairman Gautam Adani said in the statement.
“The board felt that going ahead with the issue will not be morally correct,” he said, amid a rout sparked by allegations of fraud in a report by US short-seller Hindenburg Research.
On Wednesday, despite the Rs. 20,000-crore share sale sailing through on the last day on Tuesday after non-retail investors bid in big volumes, all the group companies settled in negative territory with shares of three companies hitting their lowest price band.
On Wednesday, despite the Rs.20,000-crore share sale sailing through on the last day on Tuesday after non-retail investors bid in big volumes, all the group companies settled in negative territory with shares of three companies hitting their lowest price band.
On Wednesday, despite the Rs. 20,000-crore share sale sailing through on the last day on Tuesday after non-retail investors bid in big volumes, all the group companies settled in negative territory with shares of three companies hitting their lowest price band.
The counter of Adani Ports and Special Economic Zone plunged 19.69%, Adani Total Gas slumped 10%, Adani Green Energy declined 5.78%, Adani Wilmar fell 4.99%, Adani Wilmar went down 4.99%, Adani Power dropped 4.98% and Adani Transmission (2.46%)In addition, Ambuja Cements tanked 16.56%, while ACC plunged 6.34% and NDTV went down 4.98%.
Taken together, the decline is about 38% compared to the market valuation of the group companies at the end of trading on January 24, the day when the report was released.
The company in its statement asserted “our balance sheet is very healthy with strong cashflows and secure assets”.
“The decision will not have any impact on our existing operations and future plans. Once the market stabilizes, we will review our capital market strategy,” it said.
The company said that it is working with its Book Running Lead Managers (BRLMs) to refund the proceeds received in escrow and to also release the amounts blocked in Investors bank accounts for subscription to this issue.
The stock losses saw Gautam Adani slip to 15th on Forbes rich list with an estimated net worth of $75.1 billion, below rival Mukesh Ambani, the chairman of Reliance Industries Ltd who ranks ninth with a net worth of $83.7 billion.