The board of Adani Enterprises cleared a proposal to raise Rs 20,000 crore or $2.5 billion via a follow-on public offering (FPO). The share sale to retail and institutional investors is set to be India’s largest FPO.
“We wish to inform you that the board of directors of the Company, at its meeting held today, i.e. 25th November 2022, has approved: (i) raising of funds by way of a further public offering through a fresh issue of Equity Shares by the Company aggregating up to Rs 20,000 Crore; and (ii) to seek approval of the shareholders for the aforesaid issuance by way of postal ballot process,” the company said in an exchange filing.
The FPO will help the Adani Group flagship company to reduce debt and fund expansion plans. The FPO is likely to be completed by March 2023, said reports. ICICI Securities and Jefferies will manage the FPO.
According to publicly available data, promoter holding in the company stands at over 72%, while Foreign Institution Investor (FIIs), retail and mutual fund holding in the company is 15. 59%, 6.46% and 1.27% respectively.
An FPO will also allow the company to increase its public float of shares, and bring it at par with other companies of similar size such as Reliance Industries and Tata Consultancy Services (TCS). The market capitalisation of billionaire Gautam Adani’s company as of Friday’s market close was at Rs 4.44 lakh crore.
More banks are likely to join the FPO, but ICICI Securities and Jefferies were the first to alert some institutional investors to gauge their mood on the issue.
