Adani Made (and Could Lose) a $147 Billion Fortune
When U.S. short seller Hindenburg Research alleged last week that the Adani Group—the energy and infrastructure conglomerate he controls—was engaged in wide-ranging fraud, the fallout was widespread and severe.
His companies’ stocks and bonds plunged, leaving investors with billions of dollars in losses and igniting a bitter fight that the company cast as an assault on the nation itself.
On Wednesday, Mr. Adani’s flagship company, Adani Enterprises, canceled a stock sale of up to $2.5 billion.
Mr. Adani’s fortune is taking a hit. In September 2022, Mr. Adani, 60 years old, briefly displaced Amazon.com Inc. founder Jeff Bezos as the world’s second-richest man, with a net worth of $147 billion, according to the Bloomberg Billionaires Index.
Hindenburg’s allegations have shaken what many Indians call the Gujarat model of economic growth—a reference to the home state of both Messrs. Adani and Modi. The approach has involved using large government subsidies to fund infrastructure construction by private firms such as Mr. Adani’s.
The opposition Congress party has used the Hindenburg report to cast the Adani Group as an oligarch enabled by the Modi government.
As of Wednesday, the seven listed companies bearing Mr. Adani’s name had lost about $85 billion in market capitalization since the release of the report.
WSJ 1 February 2023
https://www.wsj.com/articles/gautam-adani-fortune-hindenburg-modi-11675269600
Adani Abruptly Abandons $2.4 Billion Stock Sale as Crisis Mounts
Company had guaranteed full subscription to new shares
The flagship company of beleaguered Indian tycoon Gautam Adani pulled a record 200 billion-rupee ($2.4 billion) share sale after a selloff triggered by a US short seller’s report engulfed his group in turmoil.
Adani Enterprises Ltd. decided not to go ahead with its follow-on public offer of shares, according to a statement late on Wednesday. Bloomberg News reported earlier in the day that Adani was nearing a decision to withdraw the share sale, even though it was fully subscribed, with backing from prominent Indian and Gulf investors.
The decision came after a renewed slump in price for the company and sister firms. The plunge accelerated after Bloomberg News reported Credit Suisse Group AG has stopped accepting bonds of Adani’s group of companies as collateral for margin loans to its private banking clients.
“It’s unusual for a secondary offering like this to be canceled,” said Ben Silverman, director of research at VerityData. “Pulling an offering at the last minute doesn’t inspire a lot of confidence right now.”
Adani Enterprises was offering shares to investors at 3,112 rupees to 3,276 rupees apiece in the offering. The company’s stock closed Wednesday at 2,135.35 rupees, or 31% below the bottom of the price range, meaning any investor in the share sale would be sitting on immediate losses.
Bloomberg 1 februari 2023
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