Adani Enterprises continues to sink further in troubled waters due to the fallout of the damning Hindenburg report as the conglomerate cancelled its Follow-On Public Offering (FPO) on Wednesday and will return money to its investors.<\/p>\n\n\n\n
In an exchange filing, the business group said that the decision was taken at a meeting of its Board of Directors, who, in the interest of its subscribers, decided not to proceed with the FPO of equity shares aggregating up to Rs 20,000 crore of face value Rs 1 each on partly paid-up basis, which was fully subscribed.<\/p>\n\n\n\n
Embattled chairman, Gautam Adani, issued a statement, saying the decision was taken amid the fluctuations the company\u2019s stocks witnessed during the day’s trading. Adani said it wouldn\u2019t have been morally correct to go ahead with the FPO due to the unprecedented fluctuations in the group\u2019s stock prices on Wednesday.<\/p>\n\n\n\n
Adani pointed out that the group feels that the interest of the investors is paramount and \u201chence to insulate them from any potential financial losses, the Board has decided not to go ahead with the FPO.”<\/p>\n\n\n\n
Adani Enterprises is working with its Book Running Lead Managers (BRLMs) to refund the proceeds received by it in escrow and to also release the amounts blocked into investors’ bank accounts for subscription to this issue.<\/p>\n\n\n\n
Shares in Adani Enterprises, often described as the incubator of Adani businesses, plunged 30 per cent on Wednesday. Adani Power fell 5 per cent, while Adani Total Gas slumped 10 per cent, down by its daily price limit, Reuters reported.<\/p>\n\n\n\n
Adani Transmission was down 6 per cent and Adani Ports and Special Economic Zone dropped 20 per cent. Adani Total Gas, a joint venture with France\u2019s Total, has been the biggest casualty of the report, losing about $27 billion.<\/p>\n\n\n\n
Underscoring the nervousness in some quarters, Bloomberg reported on Wednesday that Credit Suisse had stopped accepting bonds of Adani group companies as collateral for margin loans to its private banking clients.<\/p>\n\n\n\n
India\u2019s markets regulator, which has been looking into deals by the conglomerate, has said it will add Hindenburg\u2019s report to its own preliminary investigation.<\/p>\n\n\n\n
State-run Life Insurance Corporation (LIC) said on Monday it would seek clarifications from Adani\u2019s management on the short seller report. The insurance giant was, however, a key investor in the Adani Enterprises share sale.<\/p>\n\n\n\n
Hindenburg Research published a report last week, accusing the Adani Group of indulging in improper use of offshore tax havens and stock manipulation while also raising concerns about high debt and the valuations of seven listed Adani companies.<\/p>\n\n\n\n
Read Also<\/strong>: Uttar Pradesh: Woman beat man with slippers on busy road in Jhansi, video goes viral | Watch<\/a><\/p>\n\n\n\n The group has denied the allegations, saying the short-seller\u2019s narrative of stock manipulation has \u201cno basis\u201d and stems from an ignorance of Indian law, adding that it has always made the necessary regulatory disclosures.<\/p>\n\n\n\n Hindenburg Research on Monday hit back at the Adani Group, day after the business house dubbed the New York-based firm\u2019s report as \u201ccalculated attack on India.\u201d<\/p>\n\n\n\n In a response titled \u201cFraud cannot be obfuscated by nationalism or a bloated response that ignores every key allegation we raised,\u201d Hindenburg Research accused the Adani Group of holding back India\u2019s progress by draping itself in the Indian flag while systematically looting the nation.<\/p>\n\n\n\n Hindenburg said it believes that India is a vibrant democracy and an emerging superpower with an exciting future. However, the research group alleged that the country\u2019s future was being held back by the Adani Group, \u201cwhich has draped itself in the Indian flag while systematically looting the nation.\u201d<\/p>\n\n\n\n Hindenburg stressed that it\u2019s a firm believer in the fact that fraud is fraud even when perpetuated by one of the wealthiest individuals globally.<\/p>\n\n\n\n The Group\u2019s chairman, Gautam Adani on Wednesday dropped to 15th on the Forbes rich list with an estimated net worth of $76.8 billion as the shares of his conglomerate plunged once again in the aftermath of the Hindenburg group report.<\/p>\n\n\n\n Before the scathing report by the US short-seller, Adani was ranked third on the list and also ranked Asia\u2019s richest person, a title which he also lost after his personal fortune reportedly fell by over $40 billion.<\/p>\n\n\n\n