The loss of over $100 billion in value for the Adani group. one of India’s biggest companies is facing an unprecedented crisis.
The Adani group has lost about $100 billion in valuation in just a week. Its founder Gautam Adani has personally lost more than $30 billion in that time. he is no longer Asia’s wealthiest man.
The stock markets have also responded, you know shares of various Adani companies have plunged so low that trading had to be paused for some of them. Now all of this is a reaction to the surprising announcement made by the group last night.
The company says it canceled its follow-on-public offer or FPO. last week it listed additional shares in the stock market. the FPO was pretty successful they raised about 2 1/2 billion dollars. the company says because of the volatility in its stock prices and to protect investors. It will be returning that money to investors.
But international and local media have questioned the credibility of the FPO in the sense that accusing The Adani group of sorts of orchestrating its success. two of the companies that underwrote that FPO, which basically means did the risk analysis for investors linked to the Adani group.
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It has also been reported that a lot of the money came from Adani’s personal friends who poured in their own personal wealth. there’s also a $400 million check that came from a firm in Abu Dhabi that is backed by the royal family over there. now remember all of this is a response to the dam report by an American company last week.
Hindenburg’s research accused the Adani group of quotes. pulling off the largest column in history. which has accused the group of stock market manipulation and accounting fraud. The Adani group has denied these allegations.
Political repercussions
there is a huge credibility crisis playing out over here, financially as well as politically or financially speaking. banks are keeping a close eye. it is reported that at least two international banks are no longer accepting Adani’s bonds as collateral. so people who have those loans now have to furbish alternative collateral.
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It is also reported that India’s National Bank has asked other banks to reveal their exposure to the Adani group. politically speaking opposition parties have long believed and long said that the Adani group enjoys special status because of a personal friendship between Prime Minister Narendra Modi and founder Gautam Adani.
We are now demanding a probe and also demanding a parliament debate on what’s going on in one of India’s biggest companies. now interestingly this comes as the Adani group has cracked an important deal overseas. it now owns Haifa port in Israel’s billion-dollar deal. there are pictures with Prime Minister Netanyahu that were released there’s also the conversation, that the Adani group will be investing in building artificial intelligence labs in Israel.
