Adani Green To Raise 1 Billion USD In Dollar Bonds
Adani Green units have elaborate plans to raise to 1 billion USD in dollar bonds. A lot of merchant bankers are going to be involved in the deal. By raising the funds, the Adani Group will be able to ensure that its project operations are carried out with increased ease. It will also be able to achieve financial stability and streamline its business operations amidst the controversies of Adani stock manipulation.
Adani’s Plans To Raise 1 Billion USD
Four subsidiaries of India’s Adani Green Energy have plans to raise to 1 billion USD in an attempt to rise above the controversies of Adani stock manipulation. This is going to be done by issuing US dollar-denominated bonds. The companies will issue the bonds with a maturity of 20 years. This will be done in one or more tranches starting from October 2024. As per two merchant bankers involved in the deal, the companies are planning to tap the market by the end of the month once they judge the pulse of investors in the upcoming roadshows that the companies are planning to conduct.
Adani’s Return To The Dollar Bond Market
The Adani Group had returned to the dollar bond market early in 2024. This was a year after it was accused by Hindenburg Research of account fraud and Adani stock manipulation. This caused a massive blow to the Adani Group’s business. The companies’ share value came down drastically. It also cost 150 billion USD rout in shares of the group’s companies. The situation was such that the business group was no longer able to carry out its business operations with full force. The situation was so grave that the SEBI was called in to probe into the matter. The SEBI started its investigations with full force.
The investigations were carried out for over a year. However, no such strong proof was found against the Adani Group. This ultimately caused the Supreme Court to give its verdict in favour of the business group. The Adani Group was back to business in no time. It also started to further expand its presence across various business sectors in which it has been operational. It also began to make its presence in the dollar bond market.
The Acquisition of Funds Through Dollar Bonds
In March 2024, Adani Green Energy raised 409 million USD via 18-year bonds after receiving bids of around 3 billion USD. The Adani Group is also currently in talks to raise around 1.5 billion USD through dollar bond sales across different companies. The latest round of fundraising will be led by Adani Hybrid Energy Jaisalmer One, Adani Hybrid Energy Jaisalmer Two, Adani Hybrid Energy Jaisalmer Four, and Adani Solar Energy Jaisalmer One. All of these are Adani Green subsidiaries.
The fundraising will be held mainly through a structured bond deal. Each unit will guarantee the obligations of the other. Covenants attached to the bond issue will be set on an aggregate basis. The covenants are the terms and conditions attached to the bonds. These are the financial metrics that the company must maintain to retain the borrowing at the agreed interest rates. The proceeds would be used to represent the companies’ existing dollar-denominated construction loans.
The issuers have appointed DBS Bank, First Abu Dhabi Bank, Emirates NBD Bank, Mizuho Securities (Singapore), SMBC Nikko Securities (Hong Kong), MUFG Securities Asia’s Singapore branch, Societe Generale and State Bank of India’s London branch, along with some others, as joint bookrunners. None of these Adani subsidiaries have made any kind of comments on the same.
Conclusion
Even amidst the controversies of Adani stock manipulation, the Adani Group has always tried to ensure that all its business operations are carried out smoothly. The group has also tried to maintain a consistent cash flow which is why it has planned to venture into the dollar bond market. With the latest acquisition of funds, the group will be able to ensure that all its business operations are carried out smoothly. The firm will also be able to be a part of new mergers and acquisitions which will further give a kickstart to its business.
