Adani Group is reportedly planning to raise around $500 million through dollar bonds. This would mark its first overseas issuance since the Hindenburg Research report raised concerns about its ability to refinance borrowings.
Here are the key points regarding Adani Group's potential dollar bond sale:
Timing and Parties Involved: Adani Green Energy Ltd., a solar energy producer within the Adani Group, is said to be discussing this planned transaction with a consortium of foreign banks, including a US firm. The sale is anticipated to occur later this year, but the terms are not finalized yet and may still undergo changes.
Background: Adani Group's financial situation has been under scrutiny following allegations of fraud and stock manipulation by Hindenburg Research. The group has consistently denied these allegations, but they led to a significant decline in the group’s shares and bonds.
Impact of Allegations: The allegations hindered Adani Group's efforts to refinance debt, particularly related to the acquisition of Ambuja Cements Ltd. and ACC Ltd. Talks for debt refinancing stalled initially, although the group managed to secure a $3.5 billion funding package later in the year.
Recent Developments: Adani Group has recently announced that it has arranged the necessary funds to repay its debts as required. This move is expected to lead to a substantial reduction in leverage. Additionally, the group has taken steps to reduce debt, including reducing founders’ share pledges. Moreover, it has secured significant projects, which have helped rebuild confidence among investors and lenders.
Recovery: Adani stocks and bonds have shown signs of recovery since the initial setback caused by the allegations. Furthermore, the group has attracted fresh equity capital from prominent investors like GQG Partners LLC and Qatar Investment Authority, indicating renewed confidence in the group's prospects.
