In a huge blow to India’s billionaire businessman and Prime Minister Narendra Modi’s close friend, Gautam Adani, the Adani Group on Wednesday extraordinarily decided to call off its $2.4bn equity fundraising in the wake of more bloodbath in the stock market. This came on a day the Adani Group’s shares lost more value making Gautam Adani poorer by at least $15 billion. Adani, who was the third richest businessman only a few days ago, has now been knocked off the top ten richest list of businessmen in the world. With today’s bloodbath, he finds himself placed 15th on the list of the world’s richest people.
In a media statement, the Adani Group said, “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.”
Gautam Adani said, “The Board takes this opportunity to thank all the investors for your support and commitment to our FPO. The subscription for the FPO closed successfully yesterday. Despite the volatility in the stock over the last week, your faith and belief in the Company, its business and its management has been extremely reassuring and humbling.
“However, today the market has been unprecedented, our stock price has fluctuated over the course of the day. Given these extraordinary circumstances, the Company’s board felt that going ahead with the issue will not be morally correct.
The downfall of the Adani Group was triggered byby an investigative report by US-based Hindenburg Research, which raised serious questions on the company’s debt levels and the use of tax havens in Mauritius, Caribbean Island and Singapore among others.
Titled as ‘How The World’s 3rd Richest Man Is Pulling The Largest Con In Corporate History’, the two-year-long investigation by Hindenburg Research was published just two days before the Adani Group was planning to start a huge stock market fundraising drive. Adani was accused of ‘brazen stock manipulation’, ‘accounting fraud’and ‘money laundering.’
Reacting to the report, the Adani Group had said, “We are deeply disturbed by this intentional and reckless attempt by a foreign entity to mislead the investor community and the general public, undermine the goodwill and reputation of the Adani Group and its leaders, and sabotage the FPO (Follow-on Public Offering) from Adani Enterprises.”
