The controversial Adani group is seeking to sell a part of its stake in Ambuja Cement to reduce its debt and restore the flagging confidence of investors in the embattled family-run business group, reports the Financial Times. This would be the group’s first asset sale after it was hammered by allegations by Hindenburg Research in January.
Gautam Adani, the businessman whose stratospheric rise in fortunes coincided with the political rise of Prime Minister Narendra Modi, has made a formal request to international lenders to sell 4-5% of his stake in the cement company. This should allow him to raise about $450 million, says the report.
The report did not disclose who would buy the stake and said that the plan is not finalised. Adani owns 63% of Ambuja Cement, which were acquired as part of a $10.5 billion deal for Holcim’s Indian assets – Ambuja Cement and ACC, a subsidiary. This made the Adani group the country’s second-biggest cement player overnight.
A consortium of 14 international banks, led by Barclays, Standard Chartered and Deutsche Bank, had provided $4.5 billion to finance the deal. Adani has already paid back a $500 million bridge loan, which was part of this package and due to mature early this month, says the report.
Adani’s move to sell a part of his holding in the profitable cement company comes after a scathing report by US short seller Hindenburg Research which alleged fraud and stock market manipulation by the Gujarat-based group. After the report came out, the Adani group has lost $145 billion from the market value of its listed companies.
Earlier this month, a private Adani family entity has sold $1.9bn worth of shares in four of its companies to Florida-based asset manager GQG Partners.