Adani Enterprises (AEL), the flagship company of Adani Group, is in advanced stages of achieving financial closure of ₹14,500 crore required for part funding for its coal-to-polyvinyl chloride (PVC) plant in Mundra, Gujarat.
The firm intends to achieve the financial closure of ₹14,500 crore latest by mid-April, which is the first tranche of the total $4 billion (about ₹35,000 crore) needed for the project. SBI Capital Markets and Axis Bank are the lead financiers for the first tranche, sources close to the development said.
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The remaining would be arranged through internal accruals and another round of financing. The total financial closure would be achieved much ahead of its earlier announced six months’ deadline, which ends in September this year, they added.
In February, AEL had stated it will review its commitment to build a coal-to-polyvinyl chloride (PVC) plant in Gujarat, post the settlement of this volatility period. The company had planned to build a 2 million tonne per annum coal-to-PVC plant in Mundra, Gujarat. The plant was expected to produce PVC products such as suspension PVC (resin), chlorinated PVC (C-PVC) and emulsion PVC (paste), AEL had said in its submission to the Ministry of Environment, Forests & Climate Change in 2021.
Feedstock coal of about 3.1 million tonne per year for the project will be sourced mainly from Australia, Russia and other countries, it had said, adding it expected the project to be on stream within four years of receiving all the necessary approvals.
Earlier this month, Adani Group has pre-paid a total of $2.65 billion debt that included a margin-linked share-backed financing and another $500 million taken for acquisition of Holcim Group’s Indian assets, ahead of March 31 deadline. Of the total, $2.15 billion was share-backed financing, and the pre-payment was in line with the promoters’ commitment to increase equity contribution.
The promoters have also infused $2.6 billion into Ambuja Cements
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The group, controlled by billionaire Gautam Adani, had been trying to improve its financial position and reduce debt to regain investors’ faith following a January report by short-seller Hindenburg Research that shaved off nearly half of its market capitalisation.
Earlier on January 24, the US-based Hindenberg Research published a two-year investigation’s findings, alleging that Adani had participated in market manipulation and accounting malpractices. It also accused Adani of perpetrating “the largest con in corporate history,” engaging in “brazen stock manipulation and accounting fraud scheme over the course of decades.” Hindenburg also revealed that it held short positions on Adani Group companies.