Adani Enterprises calls off fully subscribed FPO, to return money to investors

Adani Enterprises on Wednesday said it has decided not to go ahead with its Rs 20000crore Followon Public Offer FPO and will return the proceeds to investorsThe announcement comes a day after the companys FPO was subscribed fully on the last day of the offer on TuesdayThe Board of Adani Enterprises Ltd AEL decided not to go ahead with the fully subscribed FPO Given the unprecedented situation and the current market volatility the company aims to protect the interest of its investing community by returning the FPO proceeds and withdraws the completed transaction the company said in a statementAs many as 462 crore shares were sought as against an offer of 455 croreNoninstitutional investors put in bids for over three times the 9616 lakh shares reserved for them while the 128 crore shares reserved for qualified institutional buyers QIBs were almost fully subscribed according to BSE dataThere was however a muted response from retail investors and company employeesRetail investors for whom roughly half of the issue was reserved bid for just 11 per cent of the 229 crore shares earmarked for them Employees sought 52 per cent of the 16 lakh shares reserved for themAlso Read Adani group stocks witness sharp fall Adani Enterprises tumble over 28 pc Adani Ports over 19 pcAdani Enterprises the flagship company of the Adani Group had a lacklustre start to its FPO with only a 1 per cent subscription on the first day of the share sale The offer was opened for public subscription from January 2731Today the market has been unprecedented and the companys stock price has fluctuated over the course of the day Given these extraordinary circumstances the companys board felt that going ahead with the issue will not be morally correct The interest of the investors is paramount and hence to insulate them from any potential financial losses the Board has decided not to go ahead with the FPO Gautam Adani Chairman Adani Enterprises saidThe company said it is working with book running lead managers to refund the proceeds received in its escrow accounts and also working towards releasing the amounts blocked in investors bank accounts for subscription to this issueAdani also said the companys balance sheet is very healthy with strong cash flow and secure assets and has an impeccable track record of servicing its debtThis decision will not have any impact on our existing operations and future plans We will continue to focus on long term value creation and growth will be managed by internal accruals Once the market stabilises we will review our capital market strategy the statement saidMeanwhile shares of Adani Group firms slumped on Wednesday and have lost more than Rs 7 lakh crore of their combined market capitalisation in the last five trading sessions amid concerns over USbased short seller Hindenburg Researchs reportThe decline is about 38 per cent compared to the market valuation at the end of trading on January 24 the day the report was releasedMoreover Adani Enterprises nosedived 2845 per cent to settle at Rs 212870 on the exchangeAdani Group stocks have taken a beating on the bourses after Hindenburg Research made a litany of allegations in its report including fraudulent transactions and share price manipulation at the Gautam Adaniled groupAdani Group has dismissed the charges as lies saying it complies with all laws and disclosure requirements It called the Hindenburg report baseless and has threatened to sue the short sellerThis story has been sourced from a third party syndicated feed agencies Midday accepts no responsibility or liability for its dependability trustworthiness reliability and data of the text Midday managementmiddaycom reserves the sole right to alter delete or remove without notice the content in its absolute discretion for any reason whatsoever