KUALA LUMPUR: Malayan Banking Bhd (Maybank) does not face any financial impact from its subscription to Indian conglomerate Adani Enterprises’ share offering, the bank said today
Marquee investors Maybank Securities and Abu Dhabi Investment Authority picked up a stake in Adani Enterprises’ US$2.45 billion (RM10.4 billion) secondary share offering last Wednesday, which coincided with a short-seller report that slammed the shares of Adani group companies.
The demand from anchor investors comes despite Hindenburg Research disclosing a short position in Adani Group, accusing it of improper use of offshore tax havens and flagging concerns about high debt that eroded US$11 billion in investor wealth.
“We would like to clarify that there is no financial impact to Maybank as the subscription to Adani Enterprises were client subscriptions and fully-funded by client funds,” Maybank told Reuters in an emailed statement.
Maybank was allocated 34.09% of the 18.2 million shares reserved for institutional investors for 20.4 billion rupees (RM1.06 billion).
Adani Enterprises’ secondary share sale entered its second day amid weak investor sentiment. The stock was trading at 2,686 rupees, 13.6% below the 3,112 rupees lower end of the offer price band. The upper band is 3,276 rupees.
Initial data from stock exchanges today showed Adani has now received bids for 687,840, or 1.5%, of the 45.5 million of shares on offer. The deal closes tomorrow.
Foreign and domestic institutional investors, as well as mutual funds, have made no bids so far, according to the data.
On Sunday, the group led by Gautam Adani, the world’s third richest person according to Forbes, said Hindenburg Research’s report was a “calculated attack“ on the country and its institutions while a senior executive has compared a rout of its stocks with a colonial-era massacre.
Adani said it complies with all local laws and had made the necessary regulatory disclosures.
Adani Enterprises, the flagship firm of Adani Group, is looking to fund capital expenditure and pay off some debt from the proceeds of the share sale.
Adani group shares extended their sharp falls today as the Indian conglomerate’s rebuttal of Hindenburg Research’s criticism failed to pacify investors, driving stock market losses for the companies to almost US$70 billion over three days.
Flagship Adani Enterprises fell 2.5%, reversing its initial gains of as much as 10% and staying significantly below the offer price.
Adani Transmission, Adani Total Gas, Adani Green Energy, Adani Power, Adani Wilmar and Adani Ports and Special Economic Zone fell between 4.2% and 20% today. – Reuters