MUMBAI : Abu Dhabi-based International Holding Company PJSC (IHC) will invest $2 billion as primary capital in three Adani group companies – Adani Green Energy Ltd, Adani Transmission Ltd and Adani Enterprises Ltd, through the preferential allotment route, Adani group said in a statement on Friday.
IHC will invest Rs3,850 crore in Adani Green, Rs3,850 crore in Adani Transmission and Rs7,700 crore in Adani Enterprises. The transaction is expected to be completed in a month, after all necessary approvals are obtained, Adani group said. The capital will be utilized for pursuing the growth of the respective businesses, further strengthening of the balance sheet and for general corporate purposes, the statement added. The investment is subject to shareholder and regulatory approvals.
“We are deeply committed to the shared vision and values of investment in sustainable infrastructure, green energy and energy transition. This is a landmark transaction and marks a start of a wider relationship between The Adani Group and IHC and attracting further investment from UAE into India," said Sagar Adani, executive director of Adani Green Energy Ltd.
The investment will result in IHC picking up a 3.53% stake in Adani Enterprises, a 1.41% stake in Adani Transmission and a 1.26% stake in Adani Green.
Adani Green shares will be allotted to IHC at a price of Rs1,923.25 apiece, while shares of Adani Enterprises and Adani Transmission will be allotted at Rs1,915.85 and Rs2,454.95 per share, respectively.
Shares of Adani Enterprises closed trading at Rs2,170.70 apiece, up 3.44% on the BSE, while shares of Adani Transmission and Adani Green closed 3.41% and 7.37% higher at Rs2,542 and Rs2,323.95 per share
The companies have called for an extraordinary general meeting on 3 May to take shareholder approval for the IHC share sale.
IHC was founded in 1998, as part of an initiative to diversify and grow non-oil business sectors in the UAE. In 2021 IHC’s total assets reached AED 87 billion while total revenue grew 303% reaching AED 28,562 billion for the same period.
“This will be a long-term investment in India as the country is driving much innovation globally, including the green energy sector. The opportunity to earn a compelling return on investment in green energy has never been greater. We are confident that Adani companies will play a significant role in unleashing India’s total green energy potential, reflecting positively on our shareholders’ commitment," said Syed Basar Shueb, CEO and Managing Director of IHC.
Rating agency Moody’s in a note said that the equity investment from IHC will be credit positive for Adani Transmission.
“Today’s announcement by Adani Transmission regarding an INR38.5 billion equity investment from International Holdings Company is credit positive. If completed as announced, the equity proceeds would help alleviate some of the downward pressure on Adani Transmission’s credit metrics caused by its substantial pipeline of growth projects over the next 3-4 years," said Spencer Ng, vice president, Moody’s Investors Service.
