The Adani Group is looking to sell 4-5% stake in Ambuja Cement for about $450 million as part of plans to pare debt and restore investor confidence in the conglomerate.
A Financial Times report on Friday quoted three persons with direct knowledge of the plan as saying that Adani Group chairman Gautam Adani had on Thursday made “a formal request to international lenders” to sell a stake in Ambuja Cement. The Adanis own 63.2% in the company.
The shares will likely be offloaded in the secondary market next week — a 5% stake sale will fetch the promoters around `3,400 crore at the current market price. The Ambuja stock closed Friday’s trading session at `378.35, down 1.66% over Thursday’s close.
The spokesperson for Adani Group declined to comment.
Adani had acquired Ambuja Cement and its subsidiary ACC in mid-May last year from
Swiss cement major Holcim for $10.5 billion (around `81,360 crore) including open offers to minority shareholders.
The Adanis hold 56.7% in ACC. While Gautam Adani is the chairman of Ambuja Cement, his elder son Karan is chairman and non-executive director at ACC.
The transaction was financed by a clutch of 14 international banks which provided $4.5 billion including Barclays, Standard Chartered and Deutsche Bank.
FT reported that Adani has already paid back a $500-million bridge loan, which was part of this package and due to mature early this month, citing two people familiar with the matter.
The stock prices of the group’s companies have been under severe pressure after a report by US short-seller Hindenburg Research, in late January, alleged fraud and stock market manipulation by the group. More than $150 billion of market value of the conglomerate’s listed companies was wiped out, though the group has denied the allegations and has said servicing its $24billion of net debt will not be an issue.
Earlier this month, the Adani promoters sold shares worth $1.9 billion in four listed companies to Florida-based asset manager GQG Partners, which is listed in Australia. The group said it intended to “pre-pay all share-backed financing” by March end.
Since the Hindenburg report, the Adani group has pre-paid about $2 billion of share-backed loans and made bond repayments on time. That has helped the stock prices of the group’s firms recover over the past week. The Adani management has also been holding roadshows to reassure investors it would generate cash to repay all its borrowings.