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Indian conglomerate Adani Group is in talks with an Middle East-based sovereign wealth fund (SWF) to raise up to $1 billion for its airports business, according to a report by Indian news daily, Economic Times, citing people familiar with the matter.
The capital raise for Adani Airport Holdings will be conducted in two phases, with the first round expected to be secured from the sovereign fund by the end of Q4, the Economic Times added, without naming the SWF.
Adani Enterprises currently operates seven airports in India under its airports division and is constructing another in Navi Mumbai with a planned an investment of $21 billion over the next decade, according to group CFO Jugeshinder Singh, Economic Times added.
The fundraising coincides with Adani Enterprises, the flagship company of the Adani Group, launching a qualified institutional placement (QIP) on Wednesday to raise $500 million with proceeds used to develop airport facilities, finance capital expenditure, as well as to repay part of its debt.
Depending on investor demand, the QIP may use a greenshoe option to raise an additional $500 million.
The collective $1 billion fundraising is far lower than the group’s initial QIP target of $2 billion, which had been disclosed earlier.
Indian billionaire Gautam Adani’s company has closely worked with Gulf SWFs, the Abu Dhabi Investment Authority (ADIA) and the Qatar Investment Authority (QIA), previously.
A Reuters report in July quoted sources saying ADIA and QIA invested in Adani Energy Solutions’ share sale in India of up to $1 billion.
In August, Adani Power also expanded its foothold in the Middle East by incorporating a wholly owned subsidiary in Abu Dhabi, according to a National Stock Exchange of India filing. The subsidiary has been registered as an investment holding company, with the objective to invest in power, infrastructure, and related fields in the region.
(Writing by Bindu Rai, editing by Brinda Darasha)
