Adani to Exit Adani Wilmar, May Strike Deal in a Month
According to media reports, Adani Group has decided to exit Adani Wilmar, the FMCG vertical of the group, by offloading its entire 43.97% stake in the company. The group may strike a deal regarding this within a month, the Economic Times reported, quoting top executives.
According to the ET report, the ports-to-renewable energy conglomerate is expected to raise $2.5-3 billion by offloading Adani Wilmar stakes. Adani Wilmar is a joint venture with Singapore-based Wilmar International, which holds a 43.97% stake in the company.
Adani Group intends to relinquish control of Adani Wilmar in order to invest in various other segments. “Plans to disinvest its stake in Adani Wilmar are on these lines. The proceeds from the proposed stake sale are likely to be used for investments in other group businesses, and not to pay down debt,” the ET report suggested.
According to the report, Adani Group is also poised to sell its non-core asset stakes in order to build a liquidity buffer. The group has faced a liquidity crunch after a massive share pullout triggered by serious allegations made by US short seller Hindenburg.
As a result, Adani”s flagship company, Adani Enterprises, has lost over $150 billion in valuation.
The decision comes in the wake of Adani Wilmar”s poor Q2 performance, which saw the company record a net loss of Rs.131 crore. This was a sharp decline from the Rs.49 crore profit recorded in the same quarter of the previous year. Revenue also declined by 13% year-on-year to Rs.12,267 crore.
