In what could be the first major move by a foreign bank post the short selling fiasco faced by the Adani Group, London headquartered Barclays could be selling down its exposure to the edible oil to ports to power conglomerate.
The decision to sell down the exposure in the group follows concerns raised by some of Barclays’ investors with respect to the loan given to Adani group. “The group hitting the news for not go good reasons, especially after the Hindenburg report and some of the large investors have raised concerns over the bank’s exposure to the Indian conglomerate. This may have prompted the bank to reduce its exposure,” said a senior banker on conditions of anonymity. When contacted on email, the bank declined to comment on development.
Nearly nine large foreign banks are said to have lent to the Adani group close to $5.25 billion or nearly half the value of ACC-Ambuja cements acquisition. The deal was 2022’s most expensive M&A transaction. Banks have lent to the group as a combination of short-term loans, medium-tenure loans and long-term loans. While the exact exposure could not be ascertained, Barclays is said to lent about $750 million with most of it being for 12 – 18 months. Standard Chartered is the lead banker while Japan’s MUFG, Citibank and JP Morgan also have sizeable exposure to the acquisition funded by foreign banks.