Adani Group exits Wilmar JV, to raise $833M through stake sale

Photo : AP

The Adani Group plans to raise ₹7,148 crore (around $833 million) by selling 20% of its stake in Adani Wilmar Ltd., a company listed on the Mumbai stock market. This move is part of Adani’s plan to focus more on important areas like airports, renewable energy, and other infrastructure businesses.

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The shares will be sold in a special way through the stock market. The price for each share will start at ₹275. Adani Commodities LLP, which is one of the founding groups of the company, will sell 175.45 million shares, which is 13.5% of the company. They also have the option to sell 84.5 million more shares, which is 6.5% of the company.

The sale started on Friday, and the first day was for big investors and wealthy individuals. By 4:15 PM, 111% of the shares available had already been booked. The sale will continue on January 13 for regular buyers.

After this, the share price of Adani Wilmar dropped by 10%, which is the biggest drop since November. The shares closed at ₹291.10, showing a 21% drop in the last year.

This is the first step in Adani Group’s plan to fully exit from its partnership with Wilmar International Ltd., based in Singapore. Wilmar has agreed to buy the remaining shares at a price of ₹305 per share. Once this happens, Adani will leave the joint venture completely and use the money to invest in its main businesses.

This sale is happening at a time when the Adani Group is facing legal problems in the United States. U.S. officials say that Gautam Adani was involved in a bribery case to win solar energy contracts in India. Because of this, some rating agencies are worried about Adani’s ability to raise money and have put the group under review.

Adani Wilmar makes products like cooking oil and packaged food. According to Indian rules, listed companies must have at least 25% of their shares owned by the public within three years of listing. Adani Wilmar was listed in 2022 and has until February to meet this rule.

In August 2023, reports said that Adani Enterprises was looking to sell its shares in Adani Wilmar to raise money for its main projects. This shows that Adani Group is focusing on growing its big businesses, like airports and renewable energy.