Adani gets backing as UAE royals invest USD 400 million

Billionaire Gautam Adani’s embattled group clutched on to a USD 400-million investment by Abu Dhabi’s International Holding Co. in its flagship firm’s share sale to restore confidence in the conglomerate that saw nearly USD 70-billion rout in value after a tiny New York short seller came out with a damning report. Adani, 60, who was third richest man in the world till a day before Hindenburg Research came out with its report on January 24 that flagged concerns about its debt levels and alleged stock manipulation, accounting fraud and the use of tax havens, has slipped to 8th position, narrowing the gap with rival Mukesh Ambani, whom he overtook in April last year, to just USD 4 billion. His group late on Sunday night issued a 413-page response to the Hindenburg report in an attempt to restore confidence in the business empire but it could not cut much ice and stock prices of most group companies continued to fall and key dollar bonds sank to fresh lows on Monday. The US short seller dismissed charges that its report on Adani Group’s malfeasance was a ”calculated attack” on India, saying a ”fraud” cannot be obfuscated by nationalism or a bloated response that ignored key allegations. Hindenburg released the report on January 24 — the day on which Adani Enterprise Ltd’s Rs 20,000-crore follow-on share sale opened for investors. While anchor investors poured in almost Rs 6,000 crore in the FPO on that day, the public subscription remained muted with just 3 per cent of the shares on offer being subscribed till Monday evening, according to information available on BSE. The offer closes on January 31 and the retail investor portion — which is the biggest chunk of the FPO — is hardly 4 per cent subscribed.