The proposed initial public offering by Adani Wilmar Ltd (AWL) has been kept on hold by markets regulator SEBI without disclosing the reason.
AWL is a 50:50 joint venture company between the Adani group and the Wilmar group. The company was planning to raise ₹4,500 crore through the initial public offering. It had filed a draft red herring prospectus (DRHP) with SEBI on August 3.
SEBI, however, said in a recent disclosure that “issuance of observations kept in abeyance”
A spokesperson for Adani Group said, “SEBI has put on its website that Adani Wilmar IPO ‘Issuance of observations kept in abeyance’. However, we have not received any formal communication from SEBI with respect to the IPO observations being kept in abeyance.”
“While we have always been fully compliant with applicable SEBI Regulations, we have made full disclosure to SEBI on specific information requests from them in the past. We will continue to co-operate with the regulators in the future as well,” the spokesperson added.
The Finance Ministry recently told Lok Sabha that SEBI and the Directorate of Revenue Intelligence are probing some Adani group companies.
IPO proceeds
The net proceeds from the IPO were proposed to be used by AWL to fund capital expenditure for expansion of its existing manufacturing facilities and developing new manufacturing facilities. It also looked to repay or prepay its borrowings, fund strategic acquisitions and investments; and for general corporate purposes.
AWL offers most of the essential kitchen commodities for consumers, including edible oil, wheat flour, rice, pulses and sugar under a diverse range of brands across a broad spectrum.
In June, SEBI had put on hold its approval for the proposed initial public offers of Aditya Birla Sun Life Asset Management Company, and GoFirst (erstwhile GoAirlines) without citing any reason.
The SEBI decision is expected to delay the IPOs that are critical to all three companies but especially for GoFirst. The airline needs to raise funds to meet its debt repayment obligations as the aviation sector has been severely impacted by the Covid pandemic.
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