Bill Ackman says banks involved in the Adani Group's $2.5 billion share sale face 'too much liability exposure' and should do more due diligence
Bill Ackman has said that banks involved in the Adani Group's share sale face too much liability exposure.
His comment tracks a report that says bankers are mulling over extending the $2.5 billion sale or cutting the issue price.
"I don't see how the bankers for the [Adani Group] equity offering can allow it to close without doing due diligence," Ackman said.
Billionaire Bill Ackman has warned that the banks involved in the Adani Group's share sale have too much liability exposure and should carry out a complete due dilligence.
In a Sunday tweet, Ackman said: "I don't see how the bankers for the @AdaniOnline equity offering can allow it to close without doing due diligence on the issues identified in the @HindenburgRes report."
"There is just too much liability exposure for the banks," he added.
The Adani Group recently slipped into turmoil following a scathing report by short-seller Hindenburg Research accusing the Indian energy-to-infrastructure conglomerate of stock manipulation and accounting fraud. They even went as far as to accuse Asia's richest man Gautam Adani of "pulling the largest con in corporate history"
It's come at a highly unfortunate time for the Adani Group given a secondary share sale of Adani Enterprises — the flagship business of the Adani business empire – is underway. The sale plans to raise up to 200 billion Indian rupees, or $2.5 billion.
Ackman's tweet cited a report saying the sale remains on the table with bankers on the deal mulling over extending the sale or cutting the issue price.
The Pershing Square Capital Management CEO has previously voiced support for the Hindenburg report, saying he found it highly credible and well researched. Ackman also compared Adani Group to Herbalife, a "pyramid scheme."
Meanwhile, Adani has slammed the report calling it "maliciously mischievous." It also issued a 413-page rebuttal against Hindenburg, saying it's report is "nothing but a lie." The company said it is even looking at launching legal action against Hindenburg over the allegations.
As the public battle between the Adani Group and Hindenburg escalates, Adani has also seen his wealth plunge by $28 billion in the first month of 2023. That's knocked him out of 4th place on Bloomberg's Billionaires Index to seventh place. However, he still holds title as Asia's richest man.
The Adani Group did not immediately respond to Insider's request for comment.
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