Adani Group’s $750 Million Bond Issue Sees BlackRock as Top Investor

Funds managed by BlackRock have become the largest subscribers in a $750 million private bond issuance by the Adani Group. The U.S.-based asset manager, which manages around $12 trillion in assets, took on approximately one-third of the total issuance. The bonds have a tenure ranging between 3 to 5 years.

Purpose of the Bond Issue

The funds were raised through Renew Exim DMCC, an offshore entity owned by the Adani group promoter family. The capital will be used to finance the acquisition of ITD Cementation and support other growth-related investments.

Acquisition of ITD Cementation

In 2023, the Adani Group announced the acquisition of a 46.64% stake in ITD Cementation for ₹5,888.57 crore from its promoters. Following this, Renew Exim acquired an additional 20.81% through an open offer at ₹400 per share. ITD Cementation is involved in infrastructure projects such as the Jawaharlal Nehru Port Trust and ports in Tuticorin, Mundra, and Vizhinjam.

Other Institutional Participants

Apart from BlackRock, 5 other institutional investors, mainly from the U.S. and Europe, also participated in the bond issue. These include funds managed by Sona Asset Management.

Context of the Investment

As per the news reports, the bond issuance comes amid an investigation involving the Adani Group. In November 2023, the U.S. Department of Justice indicted Adani officials in a bribery-related case. This $750 million raise is Adani’s second private dollar bond issuance. In February, the group raised around $200 million for its Australian port operations.

Conclusion

The $750 million bond issue by Adani Group, with BlackRock as its largest investor, is one of the group’s major fundraising efforts in recent times. The funds are for acquisitions and expansion in the infrastructure sector.

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