Adani Enterprises in talks for $2-bn mega fundraise

Adani Enterprises, the flagship entity of the Adani Group, is in talks with at least half a dozen sovereign and global pension funds and energy majors, such as the Abu Dhabi Investment Authority (ADIA), the Qatar Investment Authority (QIA), a BNP Paribas arm and TotalEnergies SE, to raise up to $2 billion in equity sales.

Other potential investors include international energy infra operator SNAM, the Ontario Teachers' Pension Plan and Apollo Global, two top investment banking sources familiar with the matter told ET.

The proposed fundraising is part of the Adani Group’s broader plan to make Adani Enterprises a ‘sustainable’ energy major while decarbonising transportation and industrial sectors and help achieve India’s green objectives.


“The proposed equity sale could be in the range of 5-10 percent,” said one of the banking sources cited above. The deals are likely to be finalized in the next few quarters.

The Adani Group, QIA and TotalEnergies SE did not respond to ET’s queries. ADIA, Teachers’, Apollo and BNP declined to comment.

“SNAM is not involved in these alleged talks,” said a company spokesperson.

To be sure, SNAM has an existing Adani Group partnership, dating back about a year.

The Gautam Adani-controlled Group has laid out a mega investment plan of up to $70 billion in the next 10 years to build and acquire renewable assets. About a fifth of the proposed outlay would be financed through internal accruals while the rest could be through a combination of different routes including foreign direct investments, loans and bonds.

The share of Adani Enterprises’ mining business will likely reduce to less than 10% as no new capital is expected to be allocated to coal, sources said. Mining accounts for about a third of the company’s total assets at Rs 51,643 crore at the end of FY21, show Bloomberg data compiled by ETIG Intelligence. The move will help reduce the weighted average cost of capital.

Adani Enterprises is now aiming to accelerate the production of green hydrogen, supply chain and output of products such as fertilisers.

The supply chain business pertains to the manufacturing of equipment used in producing green hydrogen, solar and wind power.

“Once you generate power through such a sustainable mode and link it up with known capacity of Adani to build world-class infrastructure, it becomes easy to see how this will be a game changer given the cost advantages,” said a senior executive who has helped the group raise money.

Adani Enterprises aims to have a manufacturing capacity of 10 gigawatts each year from such expansion plans, said the executive.

Green hydrogen is converted into ammonia, which can be used as fuel or combined with other waste gases to produce fertilisers.

Adani Enterprises is primarily engaged in mining services, railroad, airport constructions, eddible oil and food.

Globally, companies are focusing on green energy to save the environment with a sustained focus on ESG, or Environment Social and Governance, which has become a robust investment theme. Focusing on green energy reduces borrowing costs due to committed deployment of funds by ESG-focused investors.