Adani prepays loans worth $1.11 bn, releases pledged shares in 3 firms

Promoter-pledged shares in transmission, ports, green energy arms will be released

The promoters of the Adani group have prepaid loans worth $ 1.11 billion on Monday, thus releasing the pledged shares in three key companies — Adani Green Energy, Adani Ports, and Adani Transmission.

The group said the promoters had posted the amounts to prepay $1.11 billion ahead of their maturity in September next year, after recent market volatility, and thus showing their commitment to reduce promoter leverage backed by listed-company shares.

With the prepayment, the shares of the three listed companies will be released in due course: The pledged shares of Adani Ports and Special Economic Zone represent 12 per cent of the promoter holding.

And they are about 3 per cent in Adani Green Energy and 1.4 per cent in Adani Transmission. With this, there will not be any pledged shares of the promoters in these three entities.

“This is in continuation (with) the promoters’ assurance to prepay all share-backed financing,” the group said.

Shares of Adani Green Energy closed 5 per cent down at Rs 887 while for Adani Transmission they were lower by 10 per cent at Rs 1,261. The shares of Adani Ports and Special Economic Zone closed 9.5 per cent up at Rs 546.

With the promoters releasing their pledged shares, there will be less pressure on them if the share prices of the group companies fall further because there will not be any top-up demand from the lenders, say market analysts.

Adani group shares came under severe attack after American short-seller Hindenburg Research alleged market manipulation by the conglomerate.

Hindenburg said it had taken short-selling positions in Adani group bonds overseas. The group has denied the charges, saying the allegations had been made without any evidence. It plans to take legal action against the short-seller.

On February 3, Fitch Ratings said there was no immediate impact on the ratings of Adani Green Energy, Adani Ports and Special Economic Zone, and Adani Transmission and it expected no material changes to its forecast on cash flow for these entities.

“There are also no near-term significant offshore bond maturities, … reducing refinancing risks and near-term liquidity risks,” Fitch had said.

On Adani Transmission, it said its business profile benefited from its regulated asset base, a payment-pooling mechanism for transmission assets, diversified counterparty exposure, and an established record in executing and operating projects.