The Rs 20,000-crore follow-on offering of Adani Enterprises managed to pull through on the final day on Tuesday with support from overseas investors as well as family offices of several prominent Indian businessmen in the non-institutional investors or NII category.
According to people in the know, family offices of prominent Indian business
families, including that of Mukesh Ambani, Sajjan Jindal and Sunil Mittal, are said to have invested in the FPO. Partnership firms and HUFs also participated in the issue.
The issue garnered bids for 50.8 million shares against the offer size of 45.5 million shares, data from the BSE as of 7 pm showed. This translates to an effective subscription of 1.12% on the second day of the sale.
The oversubscription was despite the shares of Adani Enterprises trading in the secondary market remaining below the lower end of the follow-on offer price of Rs 3,112. On Tuesday, shares of Adani Enterprises rose 3.4% to end at Rs 2,975, after a 4.2% gain the previous session.
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Foreign portfolio investors (FPIs) bid for 12.43 million shares out of a total of 12.82 million shares on offer in the QIB category, BSE data showed.
These included foreign institutional investors such as Abu Dhabi Investment Authority, Maybank Asia, Goldman Sachs, Nomura, Societe Generale, Jupiter, BNP Paribas, Al Mehwar, Citigroup and Morgan Stanley.
Domestic investors such as Life Insurance Corporation of India, SBI Employee Pension Fund, HDFC Life and SBI Life were part of the anchor book, price at the higher end of the price band at Rs 3,276 per share. No mutual fund participated.
NIIs put in over Rs 5,000 crore, bidding for 31.93 million shares against 9.6 million on offer, resulting in an oversubscription of 3.3 times in the category. In the Rs 1-million plus sub-category, investors bid for 31.85 million shares, corporates bid for 16.7 million shares, while individuals (other than RIIs) bid for 1.12 million shares.
The participation from retail investors was muted, with an overall subscription of 12%. The portion reserved for employees was subscribed 55%.
An FPO has to garner an overall subscription of 90% for it to be successful. On Saturday, Adani Group CFO Jugeshinder Singh had clarified that there was no change in the offer price or the schedule for the FPO.
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In a boost to the FPO’s prospect, Abu Dhabi’s International Holding Company (IHC) said it would invest $400 million in the FPO via its subsidiary Green Transmission Investment Holding RSC on Monday. IHC was an investor in the offering’s anchor book as well.
The net proceeds of the FPO will be used for debt repayment and capital expenditure of AEL and its subsidiary companies. The tentative date for share allocation is February 3. The anchor book for the FPO was oversubscribed on Wednesday, with the company finalising allocation of 18.26 million FPO equity shares to 33 investors, aggregating to about Rs 6,000 crore.