Corporate Grapevine     

Published: December 31, 2024
Updated: December 31, 2024

Adanis ‘brush off’ US indictment

The year 2025 is crucial for the Adanis group. After the group was indicted by the US Department of Justice, the group has bounced back with the completion of a test flight at the Navi Mumbai airport. The airport is a marquee project for the Adanis as it shows the group’s execution capabilities.

The group will also start work on the Dharavi redevelopment — another game-changer project for Mumbai. The Adanis have also exited from Adani Wilmar JV so as to raise $ 2 billion. The group has signed an agreement with Wilmar International of Singapore, which includes a two-step transaction – an OFS and sale of the rest of the stake to Wilmar. The group plans to utilise the proceeds to turbocharge growth of AEL in core infrastructure businesses — mainly energy & utility, transport & logistics, and primary industry-adjacent businesses.

FUNDS APLENTY

With this transaction, the Adanis are “back with a bang”, having removed a liquidity perception overhang, apart from it being their first major transaction post the US DOJ indictment in November. The transaction is expected to be consummated before March 31, 2025. The group will strengthen the incubation capacity of AEL, and will further sharpen the focus on consumer services under airports and Adani Digital, under which AEL already services 350 million consumers.

This also demonstrates Adani’s disciplined approach to finance at the portfolio level. The group has 63 per cent equity deployed as a percentage of overall assets, and this will increase further as part of this transaction. This is also consistent with AEL’s fund- raising plans as it raised $ 500 million in October 2024, and with the latest transaction AEL would have raised $ 2.5 billion. Further, other group companies AESL raised $ 1 billion and Ambuja Cements raised $ 500 million, while AGEL raised $ 444 million in the past 4 months, bringng the total to $ 4.5 billion.

Sources close to the Adani group are confident that till the Prime Minister Mr. Narendra Modi is in power, the group will not face any problem.