India's leading business group Adani calls off FPO amid crisis

0 Comment(s)Print E-mail Xinhua, February 2, 2023
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NEW DELHI, Feb. 2 (Xinhua) -- In a sudden move, one of India's leading business groups "Adani Enterprises" decided late on Wednesday to call off its flagship shares sale worth 200 billion Indian Rupees (around 2.4 billion U.S. dollars) and refund the money to its investors.

The Follow on Public Offer (FPO) was fully subscribed on Tuesday.

The sudden decision of Adani Enterprises is seen in the light of a report by the U.S.-based "Hindenburg Research" last week that alleged "improper use" of offshore tax havens by the company and flagged concerns about high debt and the valuations of seven listed Adani companies.

On Wednesday Adani Enterprises' shares had nosedived by over 28 percent, as its CEO Gautam Adani slipped out of the list of the world's top 10 richest people.

Media reports quoted the Indian government sources as saying that the country's central bank the Reserve Bank of India has asked local banks for details of their exposure to the Adani group of companies.

Citing "unprecedented" situation, the Adani Group released a statement saying "The Board of Adani Enterprises Limited decided not to go-ahead with the fully subscribed Follow-on Public Offer (FPO). 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." Enditem

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