Mumbai: Adani Enterprises on Wednesday said it has decided to withdraw its fully subscribed Rs 20,000-crore follow-on public offer (FPO) and will return the proceeds to investors.
On February 1, 2023, when the budget was being presented in the Parliament on one side and the stock market was witnessing a boom, on the other hand Gautam Adani, the owner of Adani Enterprises, was facing a different difficulty.
By evening on Wednesday, Adani Enterprises Limited had to cancel its FPO (Follow-on Public Offer) worth Rs 20,000 crore.
The reason for this was a report by Hindenburg Research, an American forensic financial company, in which serious questions have been raised on the Adani group.
This FPO of the company was the biggest ever FPO of Rs 20,000 crore and was fully subscribed i.e. completely sold.
Common people did not invest money in this FPO, but on Tuesday big companies and some rich people invested a lot of money in it.
The announcement came a day after the company's FPO was fully subscribed on the last day of the offer on Tuesday.
"The Board of Adani Enterprises Ltd., (AEL) has decided not to go ahead with the fully subscribed FPO.
'Company aims to protect interest of its investing community'
"Given the unprecedented situation and the current market volatility the company aims to protect the interest of its investing community by returning the FPO proceeds and withdraws the completed transaction," the Adani group's flagship company said in a statement.
"The interest of the investors is paramount and hence to insulate them from any potential financial losses, the Board has decided not to go ahead with the FPO," Adani said.
The company said that its working with its Book Running Lead Managers (BRLMs) to refund the proceeds received in escrow and to also release the amounts blocked in Investors bank accounts for subscription to this issue.
The company also said that its balance sheet is very healthy with strong cash flow and secure assets, and has an "impeccable track record of servicing our debt".
"This decision will not have any impact on our existing operations and future plans.
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