When the Adani Group acquired Ambuja Cement and ACC from Holcim for Rs 52,000 crore, it became India's second largest firm in the sector. That was when Adani was expanding into different sectors with big ticket takeovers such as that of news channel NDTV. But months later, damaged by the Hindenburg report's allegations of fraud, Adani has been forced to sell a 4.5 per cent stake Ambuja Cements to cut its debt.
Raising funds to cut debts
After raising Rs 15,000 crore from a stake sale to US-based GQG, the Adani family is reportedly selling shares worth more than Rs 3,000 crore in the cement business. Through two special purpose vehicle for investments, Adani's promoter stake in Ambuja is currently at 63.22 per cent. About $1.1 billion from the $3 billion that Adani paid for Holcim's stake in Ambuja, was raised by pledging stocks in firms including Adani Ports.
Clearing out loans taken for shares
But ever since accusations of using inflated stocks to borrow money, Adani has been prepaying loans taken against shares. For acquiring Ambuja and ACC stakes from Holcim, Adani had roped in 14 banks to finance the deal. As Adani moves forward to clear more dues to reassure investors, it has also cut down on capex and revenue targets, which could slow down its aggressive expansion.
Aiming to retain momentum
The previous stake sale to GQG had triggered a 5-day rally for Adani Group stocks, but Adani Enterprises and three others fell by as much as 11 per cent in two days, to end the week in red. The upcoming fundraiser may help Adani stocks continue their recovery from a month-long rout.
