Adani to exit Wilmar Joint Venture, to sell 44% in FMCG company for $2 billion

MUMBAI: In a deal that will release capital for the Adani Group, the Ahmedabad-based conglomerate led by Gautam Adani is selling the staples business, Adani Wilmar, to Wilmar International of Singapore for $2 billion. This fund inflow is expected to address the group's liquidity requirements for its core infrastructure business.
The group, through flagship Adani Enterprises and its wholly-owned subsidiary Adani Commodities, holds 44% in Adani Wilmar that owns the Fortune sunflower oil and Kohinoor basmati rice brands.
Of the 44% the group owns, Wilmar will buy 31% at Rs 305 per share, increasing the Singaporean company's stake to 75% from 44% in the Mumbai-listed Adani Wilmar. The price is a 7.2% discount to Monday's close and values the portion being sold to Wilmar at $1.4 billion. Indian regulations require public shareholders to maintain a minimum 25% ownership, restricting promoters' share to 75%.

The remaining 13% stake will be offered to the public through an offer for sale, with current public ownership at 12%. This ends the group's 25-year presence in the staples sector. Following this, Pranav Adani, nephew of Gautam Adani, and Malay Mahadevia, his childhood friend, stepped down from Adani Wilmar's board on Monday. The company will be renamed to AWL, AWL Agri Business, or Fortune Agri Business after the deal.
The sale comes one month after US authorities accused Gautam Adani of securities and wire fraud for being involved in a $265 million bribery scheme related to Indian power contracts, allegations that the group has rejected.
The proceeds from Adani Wilmar's sale will support growth in the group's primary infrastructure operations. Previously, the group sold its financial services business to American firm Bain Capital.