Adani to repay $1.1 billion loan early to ease pressure on subsidiaries' shares
By Geoffrey Smith
Investing.com -- Gautam Adani and his family have gathered the funds to repay a $1.1 billion loan early, aiming to ease the pressure on the stocks of the Indian billionaire's portfolio companies.
The Financial Times cited a statement from Adani Enterprises Ltd (BO: ADEL ) saying that the loan, which was due in 2024, had been extended by a consortium of banks including Citigroup, JPMorgan, Deutsche Bank, Barclays and Japan-based SMBC Group.
According to the FT, the repayment will release 168 million shares in Adani Ports (BO: APSE ), 27M in Adani Green Energy (NS: ADNA ) Ltd (BO: ADNA ) and 12M in Adani Transmission Ltd (BO: ADAI ), three of the group's most valuable portfolio companies.
That will give Adani and his relatives more financial room to maneuver as it scrambles to meet a succession of debt repayments which his companies are due to repay this year.
However, it appears unlikely to dispel doubts about the company's ability to meet all of those debts, which short-seller Hindenburg Research argues are only propped up by collateralization against holdings of stock that remains wildly overvalued.
Hindenburg's report has galvanized opposition to the government of Prime Minister Narendra Modi in recent days, with lawmakers shutting parliament down on Monday for a third straight session as the government continued to refuse to allow a debate on the report.
Adani hails from the same northwestern state of Gujarat as Modi, and has borrowed heavily to finance the growth agenda touted by Modi over the last eight years. Both Adani and Modi's BJP Party reject suggestions of undue government influence in favor of Adani's businesses.
Adani Enterprises, the mogul's flagship holding company ended Monday down 0.9% in Mumbai. It's down over 55% since Hindenburg published its explosive allegations of accounting fraud and stock manipulation. Adani continues to reject the allegations as baseless.
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.
Back to normal with in weeks timeLike 0
Drop an image here or Supported formats: *.jpg, *.png, *.gif up to 5mb
Drop an image here or