The Adani Group's debt concerns had already raised eyebrows ever since CreditSights flagged it as deeply overleveraged back in 2022, and kept haunting the firm even after the rating agency toned down the warning. As the conglomerate worked on addressing debt concerns, the Hindenburg Research report accused it of borrowing loans against inflated stocks and spooked investors again.
As it seeks to raise another $800 million in loans while prepaying other debts, Adani has reportedly reduced its $1 billion debt picked up for acquiring Holcim's Indian units, by $200 million.
Could buy more time for the conglomerate
Apart from displaying its debt servicing capabilities, the prepayment of $200 million, will also clear the path for the port-to-cement conglomerate to secure a three-year extension on the loan.
The mezzanine loan, which adjusts terms of repayment as per a firm's cash flow, is due for maturity more than a year later in September 2024.
An expansion stopped in its tracks
The Holcim acquisition was the deal that gave the control of Ambuja Cement and ACC to the Adani Group as part of its aggressive expansion halted by the Hindenburg fiasco.
Serious allegations of pulling off the largest fraud in corporate history, led to a stock market rout which cut down the Adani Group's market value by $140 billion within a couple of months.
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