India’s Adani Enterprises calls off $2.5bn share sale | Economy News

The group’s stocks had been hammered in the past week since a US short seller raised debt, accounting concerns.

India’s Adani Enterprises has called off its $2.5bn share sale due to prevailing market conditions, the company said on Wednesday, days after a rout in its stocks following criticism by a US short seller.

“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 company said in a statement.

Shares in Indian billionaire Gautam Adani’s conglomerate plunged, driving the value of his companies $86bn lower, with the tycoon also losing his crown as Asia’s richest person.

“Today the market has been unprecedented, and our stock price has fluctuated over the course of the day. Given these extraordinary circumstances, the Company’s board felt that going ahead with the issue will not be morally correct,” Adani said.

“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,” he added in a statement.

The withdrawal marks a stunning setback for Adani, the school dropout-turned-billionaire whose fortunes rose rapidly in recent years in line with stock values of his businesses.

Adani, whose business interests span ports, airports, mining, cement and power, is battling to stabilise his companies and defend his reputation.

On Tuesday, Adani Group mustered support from investors for the share sale for Adani Enterprises, in what some saw as a stamp of investor confidence at a time of crisis.

But the selloff in Adani group stocks and bonds resumed on Wednesday, with shares in Adani Enterprises plunging 28 percent and Adani Ports and Special Economic Zone dropping 19 percent, the worst day on record for both.