On Monday, Adani Enterprises Limited (AEL) announced that it would exit from the joint venture with Wilmar International Limited under a $2 billion deal, ending a 26-year joint venture. The fund inflow from this deal is expected to address the group’s liquidity requirements.
Adani Enterprises stated, “AEL will use the proceeds from the sale to turbocharge its investments in the core infrastructure platforms in energy & utility, transport & logistics, and other adjacencies in primary industry. AEL will continue to invest in infrastructure sectors, which will further strengthen AEL’s position as India’s largest listed incubator of platforms, playing key macro themes that underpin India’s growth story.”
Right now, the Adani group holds 44% of Adani Wilmar, and Wilmar International will buy 31% at Rs 305 per share in the deal, increasing the Singaporean company’s stake to 75%. The remaining 13% of the shares would be sold to the public, with current public ownership at 12%. Indian regulations require public shareholders to maintain a minimum of 25% ownership.
Following the announcement, Pranav Adani, nephew of Gautam Adani, and Malay Mahadevia, his childhood friend, stepped down from the company board. After the 2 billion deal, the company will be renamed AWL, AWLAgri Business, or Fortune Agri Business.
This move comes one month after US authorities accused Gautam Adani of securities fraud and involvement in a $265 billion bribery scheme, which the company is fighting against.
