Adani Group secures a $3.5B Loan, ranked among Asia’s 10 Biggest Loans in 2023

In a significant financial move, the Adani Group, led by billionaire Gautam Adani, is currently in the advanced stages of securing a substantial $3.5 billion loan. This sizable loan is earmarked for refinancing existing debt initially incurred to fund the acquisition of Ambuja Cements Ltd. This development underlines the growing confidence that creditors have in the financial stability and prospects of the Adani conglomerate.

This specific deal is poised to rank among the top 10 most substantial loans in Asia for the current year and is expected to be formally completed within the week, marking a significant financial milestone. The loan is anticipated to be priced at 450-500 basis points over the benchmark secured overnight finance rate and will encompass three different timeframes: 6 months, 18 months, and 3 years. A group of banks and financial institutions have reportedly agreed to extend the loan, indicating confidence in the Adani conglomerate’s financial stability.

The journey to secure this financing followed a protracted period of negotiations with various banks. Eighteen global banks, including Barclays, Deutsche Bank, and Standard Chartered, have agreed to refinance the debt. These discussions were catalysed by allegations of fraudulent activities raised by the US short-seller Hindenburg Research. These allegations had previously caused a substantial decline in the company’s bond and share prices earlier in the year. Importantly, it should be noted that Adani has consistently and vigorously refuted these allegations, aiming to dispel any doubts about the group’s integrity.

To strengthen its financial position and move beyond the shadow cast by Hindenburg Research’s claims, the Adani Group’s flagship company proactively raised Rs 12.5 billion, equivalent to approximately $151 million, through the issuance of local-currency bonds in July. This strategic move was a clear demonstration of the group’s commitment to addressing the concerns raised by Hindenburg Research and enhancing its financial stability.