Billionaires: Gautam Adani plans to raise $1.2bn for flagship company in share sale

In our round-up of the world’s ultra-wealthy, Bill Ackman’s Pershing Square considers taking developer Howard Hughes private and Mukesh Ambani’s Reliance plans to start green energy giga factories

A successful fundraising deal would help Adani Enterprises recover confidence from global investors after US short-seller Hindenburg Research accused it of widespread fraud. Reuters

Gautam Adani’s flagship company is considering raising about 100 billion to 120 billion rupees ($1.2 billion-$1.4 billion) through a share sale, according to sources, a move that would follow a separate recent fundraising deal at his power transmission unit.

Adani Enterprises may seek to raise funds through the qualified institutional placement, or QIP, Bloomberg said citing sources.

ICICI Securities, Jefferies Financial Group and SBI Capital Markets are helping the port-to-power conglomerate on a share sale that could take place as early as next month, the sources said.

Adani Group is seeking institutional investors including from the US as part of efforts to expand its shareholder base and draw more research analysts to cover the company, one of the sources said.

Deliberations are continuing and details of the fundraising, including size and timing, may change.

Adani Enterprises in May approved raising as much as 166 billion rupees through methods including a share sale to institutions in one or more tranches.

The transaction would follow Adani Energy Solutions’ 83.7 billion-rupee recent share sale to institutional investors.

Adani Energy’s offering drew demand of about six times the base deal size, with interest from utility-focused US investors entering India for the first time, as well as sovereign wealth funds and insurers.

A successful fundraising deal by Adani Enterprises would help the billionaire’s group recover confidence from global investors after US short-seller Hindenburg Research accused it of widespread fraud and corporate malfeasance in early 2023, leading to a rout that at one point erased more than $150 billion from its market value.

Mr Adani has repeatedly denied these claims.

In another sign of the group’s rebound after the short-seller attack, Adani Enterprises last week posted a 115 per cent jump in quarterly profit, boosted by solid revenue at its airports and mining businesses.

Bill Ackman, chief executive of Pershing Square Capital, abruptly cancelled an initial public offering for a new investment fund last week. Reuters

Bill Ackman

Billionaire investor Bill Ackman’s Pershing Square Capital Management, already the biggest owner of Howard Hughes Holdings, is considering taking the $3.3 billion real estate developer private, according to a regulatory filing.

Pershing Square, which has a 37.5 per cent stake in the company, is in talks with investment bank Jefferies to evaluate acquiring the Howard Hughes shares it does not yet own, Pershing Square’s filing said.

The plans were made public only days after Mr Ackman stunned Wall Street by abruptly cancelling an initial public offering for a new investment fund that was expected to begin trading on the New York Stock Exchange last week.

Mr Ackman has been personally involved with Howard Hughes for a decade and stepped off the company’s board in April after having served as its chairman since 2010.

In March, he was full of praise for Howard Hughes’s chief executive David O'Reilly in a report to Pershing Square shareholders, writing the executive “has not yet reached iconic status but is on his way based on his progress to date”.

In April, Mr Ackman said his company intends to remain a major long-term shareholder.

But Howard Hughes' stock price, which is down 18.7 per cent since January and has lost nearly half of its value in the past five years, has been a problem for Mr Ackman for years.

It contributed only 1.4 per cent to his fund's gross performance in 2023, coming in far below other investments like Chipotle Mexican Grill and Universal Music Group.

Howard Hughes, spun off from real estate investment trust General Growth Properties in 2010, owns and manages commercial, residential and mixed-use property in the US.

Mukesh Ambani's green push for Reliance Industries is a significant shift for an empire that operates the world’s largest refining complex and giant petrochemical facilities. Bloomberg

Mukesh Ambani

Reliance Industries plans to have its factories making renewables equipment over the next year, marking a milestone for billionaire Mukesh Ambani’s conglomerate that’s been pivoting away from its fossil fuel roots.

“Over the next 12 months, our focus is to bring new energy manufacturing facilities on stream, operate them efficiently and start developing” renewable energy generation projects, the flagship of the retail-to-refining group said in its annual report for the year ended March 31.

“We would develop supply chain locally for self-sufficiency and reduce the reliance on imports.”

The tycoon had first spoken of Reliance’s foray into green energy at the annual shareholders’ meet in 2021, detailing plans to build four “giga factories” to make solar modules, hydrogen, fuel cells and to build a battery grid to store electricity.

Reliance’s arrival on the global renewable energy landscape will be truly disruptive

Mukesh Ambani,
chairman, Reliance Industries

Mr Ambani’s green push is a significant shift for an empire that operates the world’s largest refining complex, giant petrochemical facilities and still draws half of its revenue from its oil-to-chemicals businesses.

Reliance’s investors will now be looking for more details on these giga factories when Asia’s richest person addresses shareholders on August 29 – a once-a-year high-profile event from which Mr Ambani has announced his biggest business initiatives.

Reliance Industries has a net carbon zero target of 2035.

The company is doubling down on green energy at a time when its conventional energy businesses are grappling with low margins that also weighed down its latest quarterly earnings.

Its telecom and retail units – Reliance is a sector leader in both – did better.

“We have a strong background of successfully introducing pioneering transformations and gaining leadership status across market segments,” Mr Ambani wrote in the annual report.

“I am confident that Reliance’s arrival on the global renewable energy landscape too will be truly disruptive.”

Carlos Slim has seen his net worth shrink 19 per cent year-to-date, in part driven by the slump in the Mexican peso. Reuters

Carlos Slim

Carlos Slim, Latin America’s richest person, took advantage of the equity market sell-off to boost his majority stakes in two US energy companies.

Mr Slim’s Control Empresarial de Capitales spent $24.2 million in the first two days of this month to snap up 923,000 shares of Talos Energy and 357,000 shares of PBF Energy, according to regulatory filings.

The Mexican billionaire’s stake in the companies rose to 21.3 per cent and 15.5 per cent, respectively.

The investments add to a buying spree this year for the Slim family which continues to pour money into bets on oil exploration, production and refining both at home and across the Gulf of Mexico in the US.

Before the most recent purchases, his family holding company had already spent $500 million this year to amass shares in the US energy producers.

Mr Slim, who was briefly the world’s richest man more than a decade ago, has seen his net worth shrink 19 per cent year-to-date, in part driven by the slump in the Mexican peso.

After surpassing $100 billion for the first time in December, his fortune now stands at $85.1 billion, according to the Bloomberg Billionaires Index.

Compiled from Bloomberg and Reuters