Adani Enterprises to raise up to $850m via QIP

Adani Enterprises which is involved in coal mining and power generation, has launched a share sale to institutional investors to raise up to USD 850 million, sources with direct knowledge of the deal said on Tuesday.

The issue has received strong investor response and has already been subscribed by 1 time. Long-only funds, banks, and domestic institutional investors have participated in the book

This will result in a pre-issue equity dilution of about 14%. The floor price of the sale is Rs 536.15 a share, a discount of about 1.5% to the stock’s Tuesday closing price, said the sources, who did not want to be named as they were not authorised to speak to the media.

Shares in Adani Enterprises, which the market values at roughly USD 6 billion, ended 0.2 % lower on Tuesday at Rs 544.20 in a Mumbai market that fell 0.3%.

The qualified institutional placement is worth USD 600 million, with an option to increase it by USD 250 million, according to a term sheet seen by Reuters. Earlier, sources had told Reuters the company could raise up to USD 750 million.

The issue will close on Wednesday.

Adani Enterprises said in a document on its website on Tuesday that it plans to pursue "alliance opportunities" but did not say exactly how it intends to use the proceeds.

Australia’s Linc Energy was in talks with Adani to sell a coal asset for USD 1 billion, a media report quoted Linc’s chief executive as saying last week.

Adani Enterprises is one of the largest commodity trading firms in India. Its Adani Power unit, which last year raised USD 630 million in an IPO, is developing several thermal power projects in India.

The Adani share sale is being managed by Citigroup, Bank of America Merrill Lynch, Morgan Stanley, UBS, IDFC Capital, Enam Securities, ICICI Securities, and Kotak Mahindra Capital.

Popularity: 2% [?]

Tags: Adani Enterprises

Category: Stock-News