New Delhi:
Adani Enterprises has called off the sale of Rs 20,000 crore shares due to prevailing market conditions, the company said on Wednesday, days after a price drop in its shares following criticism from a US short-seller.
The Adani Group had gathered investor support on Tuesday and the follow-on share was fully subscribed on the last day for bids.
But the sell-off in Adani Group stocks and bonds resumed on Wednesday, with shares in Adani Enterprises plunging 28% and Adani Ports and Special Economic Zone down 19%, the worst day ever for both.
The group said in a statement that it will return the proceeds from the FPO to protect investors in the offering from potential losses.
Here is the full statement from the Adani Group:
The Board of Directors of Adani Enterprises Ltd., (AEL) has decided not to proceed with the fully endorsed Follow-on Public Offer (FPO).
Given the unprecedented situation and current market volatility, the Company is committed to protecting the interests of its investor community by returning FPO proceeds and withdrawing the completed transaction.
Gautam Adani, Chairman, Adani Enterprises Ltd said: “The Board of Directors takes this opportunity to thank all investors for your support and commitment to our FPO. Registration for the FPO was successfully completed yesterday. Despite the stock volatility over the past week, your confidence and faith in the company, its operations and management was extremely comforting and humbling Thank you.
However, today’s market was unprecedented and our share price fluctuated throughout the day. Given these extraordinary circumstances, the company’s board of directors believed that continuing with the matter would not be morally correct. The interests of the investors are paramount and in order to protect them against possible financial losses, the Board has decided not to proceed with the FPO.
We are working with our Book Running Lead Managers (BRLMs) to refund the proceeds we receive in escrow and to also release funds that have been held in your bank accounts for subscription to this release.
Our balance sheet is very healthy with strong cash flows and safe assets, and we have an impeccable track record of servicing our debt.
This decision will have no impact on our existing operations and future plans. We will continue to focus on long-term value creation and growth will be managed by internal accruals. Once the market stabilizes, we will review our capital markets strategy. We are confident that we will continue to receive your support. Thank you for your trust in us.”
Disclaimer: New Delhi Television is a subsidiary of AMG Media Networks Limited, an Adani Group Company.
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