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Adani Group

Adani Group Surpasses Mukesh Ambani’s RIL in 2024 M&A Deal Value

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The Adani Group outpaced Mukesh Ambani-led Reliance Industries (RIL) in terms of merger and acquisition (M&A) deal value in 2024. The group secured deals worth $6.32 billion, significantly higher than Reliance Industries’ $3.14 billion, reaffirming its competitive edge in the M&A arena. This marks a reversal from 2023 when Reliance Industries led Indian conglomerates in M&A activity, with deals totaling $8.77 billion, while Adani Group’s deals amounted to just $1.73 billion. Despite the shifting dynamics, the Adani and Ambani groups continue to dominate the M&A landscape, regularly trading the top positions since the onset of the pandemic. Meanwhile, the JSW and Tata groups have also remained active in mergers and acquisitions, focusing on capacity expansion. The collective value of M&A deals by listed entities of India’s top five conglomerates accounted for 15.3% of the total deal value last year, reflecting their significant role in shaping the country’s corporate landscape. This trend highlights the intensifying competition between India’s top industrial giants as they strategically expand their influence through acquisitions. Source: business standard Photo Credit: business standard

Adani Group Faces Corporate Governance Crisis; Fitch Places Key Stocks on ‘Watch Negative’

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The Adani Group is grappling with intensified corporate governance concerns following bribery charges against key executives of Adani Green Energy Limited (AGEL) by U.S. authorities. In response, Fitch Ratings placed Adani Energy Solutions Limited (AESL) and Adani Electricity Mumbai Limited (AEML) on a “Rating Watch Negative,” signaling a potential downgrade of their ‘BBB-‘ ratings. US Charges Spark Governance Concerns The allegations, tied to a 2021 offshore note offering, include bribery and misleading investors. With two accused executives linked to the Adani founding family, the controversy has amplified fears of systemic governance risks across the conglomerate. Fitch warned that any conviction or evidence of weak governance could significantly pressure ratings. Liquidity Remains Strong, But Risks Loom Fitch noted that AESL and AEML maintain robust liquidity, with AESL raising $1 billion via qualified institutions placement for near-term projects. AEML benefits from regulatory protections for operating costs. However, Fitch cautioned about increased reliance on onshore funding, which could elevate borrowing costs and refinancing risks in the medium term. Global Fallout The charges have drawn sharp reactions from international stakeholders. Total Energies has halted investments in Adani projects, and ESG rating agency Morningstar Sustainalytics is reviewing risks associated with Adani Green. Adani-linked dollar bonds, which initially plummeted, showed signs of stabilization but continue to face scrutiny. Future Challenges The indictment’s ripple effects extend beyond the group’s finances, potentially pressuring capital inflows and impacting India’s currency if funding risks persist. While the Adani Group has denied the allegations as “baseless” and pledged legal action, the conglomerate faces mounting global scrutiny. The coming weeks will test Adani’s ability to address governance issues and reassure investors, as reputational and financial challenges intensify. Source: Zeebiz Photo Credit: Zeebiz

Moody’s to Review Adani Group’s Governance Following Bribery Allegations

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Global credit rating agency Moody’s has announced a governance review of the Adani Group following allegations of bribery against its chairman Gautam Adani and other senior officials. U.S. prosecutors have accused the billionaire and his associates of orchestrating a scheme to pay over $250 million (approximately ₹2,100 crore) in bribes to Indian officials for favorable solar power contract terms. Moody’s Ratings issued a statement describing the charges as “credit negative” for the group’s companies, signaling potential repercussions for the conglomerate’s financial health and investor confidence. “Our primary focus is on the group’s ability to access capital to meet liquidity requirements and its governance practices,” the agency said. The indictment has raised fresh concerns over corporate governance within the Adani Group, which operates across sectors such as ports, energy, and infrastructure. The alleged bribery scheme, if proven, could tarnish the group’s reputation and strain its relationship with global investors. The allegations add to the challenges facing the Adani Group, which has already been under intense scrutiny following the Hindenburg Research report earlier this year. The report accused the group of financial irregularities and stock manipulation, leading to significant market volatility and questioning of the group’s governance standards. The new bribery charges, involving high-level officials, pose further risks to the group’s operations and financial standing. Moody’s review will likely consider the impact on the group’s ability to secure funding and its adherence to governance protocols in light of these developments. This latest controversy underscores the increasing importance of robust corporate governance in maintaining credibility and stability in global markets. The Adani Group has yet to issue a detailed response to the charges. Source: telanganatoday Photo Credit: telanganatoday

M&As in India Hit New Highs: Key Deals of Q2 2024

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India’s dealmaking activity reached new heights in Q2 2024, with 501 deals valued at $21.4 billion—the highest quarterly volume since Q2 2022, according to Grant Thornton Bharat Dealtracker. Mergers & Acquisitions (M&A) and Private Equity (PE) deals collectively stood at 467, valued at $14.9 billion, marking a 9% increase in volume but a 28% decrease in value compared to Q1 2024, due to the absence of mega-mergers like the Reliance-Disney deal. Key Highlights: Surge in High-Value Deals: The quarter saw 30 high-value transactions, a 58% increase from Q1 2024. Indian companies showed strong confidence in the domestic market, driving significant investment. Sector Leaders: Traditional sectors like pharmaceuticals and manufacturing were key contributors, accounting for nearly half of the total deal values. Domestic Deals Dominate: M&A saw 132 deals worth $6.2 billion, driven by four high-value deals from the Adani Group in the industrial materials and ports sectors, which made up 52% of the total M&A value. Cross-Border Decline: Cross-border deals saw a decline, with a 24% drop in volume and an 85% reduction in value compared to Q1 2024. Deal of the Quarter: Ambuja Cement’s $1.3 billion acquisition of Penna Cements was the standout deal, boosting Adani Cement’s market share by 2% across India. Sector-Specific Investments: Notable investments included those in EVs, industrial materials, pharma & biotech, energy & renewables, and defense. PE Landscape: Private Equity saw 335 deals worth $8.7 billion, with a 9% increase in volume and a 55% jump in value. High-value deals (≥ USD 100 million) dominated, reflecting a shift towards investments in companies with proven business models. Notable investments included Zepto ($665 million) and Lenskart ($200 million). QIP & IPO Trends: Q2 2024 recorded 20 QIPs totaling $2.3 billion and 14 IPOs valued at $4.2 billion, marking the highest quarterly IPO size since Q2 2022. Sector Trends: Retail & Consumer: Topped overall volumes but saw a marginal 7% decline in volumes. Pharma, Healthcare & Biotech: Led values with $3.8 billion across 53 deals, driven by ten high-value transactions. Manufacturing: Saw a significant rise with values increasing ninefold to $3.5 billion, mainly due to Adani Group’s high-value deals. Conclusion: M&A and PE activity in India are on an upward trajectory, fueled by domestic confidence and strategic sector investments, signaling a robust deal landscape ahead. Source: Business Standard

Despite Increased Transactions, M&A Activity Sees Sharp Decline in April

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According to a report by a consultancy firm, the overall merger and acquisition (M&A) activity by value witnessed a significant decline of 60% in April, totaling $5.192 billion compared to March’s $12.934 billion. Surprisingly, there was a 24% increase in the number of deals, totaling 176 transactions during the month. The decline in value was particularly notable in merger and acquisition transactions, which dropped by 75% to $2.526 billion, down from $10.212 billion in March. Private equity transactions, on the other hand, saw a marginal decrease to $2.666 billion. Within the M&A landscape, outbound deals experienced the sharpest decline, plummeting to $24 million compared to $9.072 billion in the previous month. The highest M&A activity of the month was attributed to the Adani group’s 8% stake increase in Ambuja Cement and ACC, amounting to a cumulative $1.8 billion in two transactions. Despite the dip in M&A activity, the outlook for 2024 remains positive, with India poised for growth and investment opportunities. Factors influencing the domestic markets in the near term include the outcome of the Lok Sabha elections and global and domestic trends in interest rates driven by inflation and supply chain dynamics. Overall, while the number of transactions increased, the decline in M&A activity by value underscores the complexities and challenges within the market landscape.  

Adani Group set to buy 49% stake in Quintillion Business Media

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According to a regulatory statement to the exchanges, Adani Group’s unit AMG Media Networks will acquire a 49 percent stake in Raghav Bahl’s digital business news platform Quintillion Business Media for an undisclosed amount. Earlier this year, the Adani Group bought a minority stake in Quintillion Business Media for an undisclosed sum. In accordance with its proposed acquisition of a 49 percent stake in the media company, it has signed a Shareholders’ Agreement with Quintillion Media Ltd (QML) and QBML, as well as a share purchase agreement with QML, QBML, and Ltd (QDML). The deal is reportedly subject to customary closing conditions as well as necessary regulatory approvals. Quint Digital Media’s stock jumped dramatically on Monday, gaining more than 9% at 12.13 p.m. The current price of the stock is Rs 325. Adani Enterprises signed a Memorandum of Understanding with Quint on March 1, 2022, and stated its intention to enter the media business by acquiring an undefined minority stake in QBML. “The proposed transaction with the Adani Group is only for QBM, a digital business news platform, and has nothing to do with Quint Digital’s other digital media/media tech properties, such as The Quint, Quintype Technologies, the new minute, and Youthkiawaaz,” it had stated. Gautam Adani’s port-to-energy business has been considering a move into the media space for several months. It engaged veteran journalist Sanjay Pugalia to oversee its media company, Adani Media Ventures, in September of last year. The Adani Group, which consists of seven publicly listed companies that operate airports and ports, power generation and transmission, coal, and a city gas distribution network, has a market capitalization of about USD 150 billion. Source: PTI