UAE royal’s firm to invest $525 million in Adani share sale

ABU DHABI - International Holding Co (IHC), which is controlled by a key member of Abu Dhabi’s royal family, said it will invest 1.4 billion dirham (S$525 million) in Mr Gautam Adani’s US$2.5 billion (S$3.3 billion) follow-on share sale, saying it believes in the fundamentals of the Indian billionaire’s empire.

IHC is making the investment in Adani Enterprises – which represents about 16 per cent of the total offering – through its subsidiary Green Transmission Investment Holding RSC, said the United Arab Emirates-based firm in a statement on Monday. In 2022, the firm invested almost US$2 billion in Mr Adani’s companies.

“Our interest in Adani Group is driven by our confidence and belief in the fundamentals of Adani Enterprises,” said IHC chief executive Syed Basar Shueb. “We see a strong potential for growth from a long-term perspective and added value to our shareholders.”

IHC’s investment comes as Mr Adani seeks to restore confidence in his ports-to-power business

following a scathing report by United States-based short-seller Hindenburg Research,

which accused the conglomerate of market manipulation, accounting fraud, and operating a web of controlled offshore shell entities in tax havens. Adani Group issued a 413-page rebuttal on Sunday, but the face-off has wiped billions off the market value of its stocks.

IHC is watching the international market closely for new prospects, and will continue exploring further opportunities outside its traditional market in 2023, said Mr Shueb in the statement. It will also explore business opportunities in Europe, Africa, Asia and South America.

Bloomberg News first reported IHC’s interest in Adani Enterprises’ follow-on offer last week.

With investments ranging from Mr Elon Musk’s SpaceX to a local fishery and Abu Dhabi’s largest property developer, IHC is at the forefront of a drive to diversify the UAE economy and deploy its oil windfall overseas.

The company, whose market capitalisation has rocketed to US$239 billion since 2019, is controlled by the Royal Group, a conglomerate that lists Sheikh Tahnoun bin Zayed al Nahyan – the UAE’s national security adviser and brother to the President – as chairman.

Last Friday, IHC said its business decisions are based on facts, after the Hindenburg report was published. Shares of IHC fell by as much as 5.2 per cent on Monday before erasing all losses by the close. BLOOMBERG