Abu Dhabi-based IHC increases stake in Adani Enterprises to over 5%

Abu Dhabi conglomerate International Holding Company (IHC) on Tuesday said it had increased its stake in Adani Enterprises (AEL) to more than 5 per cent. The move comes barely a week after the UAE-based company exited Adani Green and Adani Transmission by selling its entire holding.

“This strategic increase reflects IHC’s conviction in the world leading incubation model of AEL and we believe that the inherent strength of airports, data centres, green hydrogen, and various other verticals being incubated under AEL,” IHC said in a statement.

Gautam Adani’s flagship firm was “poised to uniquely capitalise on India’s robust growth journey”, IHC said, adding it continued to explore unique investment opportunities in India “with the goal to maximise stakeholders’ return”.

 

In a filing with the BSE, Adani Enterprises said Green Vitality RSC Ltd had acquired an additional 0.06 per cent in the company from the open market. Green Vitality was acting on behalf of Green Enterprises Investment Holding RSC and Green Energy Investment Holding RSC, both subsidiaries of IHC. With this, IHC’s total holding in Adani Enterprises now stands at 5.04 per cent.

“We see IHC’s increased stake as a ringing endorsement of our robust capex plans, governance and transparency,” an Adani group spokesperson said.

“This inter-generational relationship with IHC reflects well on India’s dynamic growth potential and offers substantial returns to our stakeholders,” the spokesperson added.

IHC’s Tuesday stake buy of 0.06 per cent would be worth Rs 163 crore on the basis of the day’s closing price. The stake, though small, takes IHC’s holding in the company past the 5 per cent mark, but whether it will accrue IHC any special rights was not immediately clear.

Last week, IHC in a statement had said it had entered into an agreement to sell its shares in Adani Green Energy and  Adani  Energy Solutions (earlier Adani Transmission). The stake on the day of announcement (September 28), was worth Rs 3,326 crore in Adani Green Energy and Adani Energy Solutions. IHC had then called the sale “part of its overall portfolio re-balancing strategy”. IHC did not disclose the buyer or value of this agreement. At the time of purchase in May 2022, they were valued at about $1 Billion combined. 

IHC had made its maiden investment in Adani companies in May 2022 where the company invested $2 billion in three Adani companies — Adani Green Energy, Adani  Energy Solutions and Adani Enterprises. With the Tuesday stake purchase, these investments now stand limited to one group company — Adani Enterprises — valued at Rs 13,718 crore (roughly $1.64 billion assuming $1 is equal to Rs 83.21) for 5.04 per cent on the basis of Tuesday’s closing price.

In January this year, IHC also committed to invest about $ 400 million in Adani Enterprises’ further public offering (FPO). The investment did not go through, as Adani Enterprises later withdrew its FPO, in wake of the Hindenburg Research report.