Adani family plans $1b investment in green energy arm

• Founders are investing money in the group's renewables firm
• The company board is meeting Dec. 26 to discuss fundraising

Billionaire Gautam Adani and his family plan to inject $1 billion into the conglomerate's renewable energy unit, people familiar with the matter said, as the group races to reach ambitious green goals while facing maturing bonds next year.

Adani Green Energy Ltd is looking to issue preferential shares to the company's founders for meeting expansion and refinancing needs, according to the people familiar with the discussions who didn't want to be identified as the talks are private. Shares rose as much as 6.7% in Mumbai after the news broke, paring this year's loss to 20%.

An Adani Group representative didn't offer an immediate comment on the founders' investment.

The company board will consider fundraising proposals on 26 December, including evaluating options such as selling shares or convertible securities, it said in a filing Wednesday without sharing any more details.

"An equity raise could boost deleveraging and lower refinancing risk, though governance concerns may linger," Sharon Chen, a Bloomberg Intelligence analyst, wrote in a 15 December note.

The company, which has a goal of 45 gigawatts of green energy capacity by 2030, also has bond maturities worth $1.2 billion coming up next year and it has already begun outlining plans for repaying or refinancing those. It also raised a loan from eight banks earlier this month.

All these efforts underscore Adani Group's attempts to draw a line over damaging allegations of corporate fraud levied by Hindenburg Research in January that plunged the ports-to-power conglomerate into crisis for months.

Clawback Mode
Despite strongly denying these allegations, Adani companies lost over $150 billion in market value at one point. The conglomerate has since then been in clawback mode — it has lowered debt, got marque investors and secured US funding for its Sri Lanka port project — winning back investor and lender confidence.

Adani Plans $84 Billion Spending After Hindenburg Market Rout

The group's stocks saw a relief rally in its shares last month after India's top court said it won't take media reports on the conglomerate as the "gospel truth" while reserving verdict on its probe into Hindenburg's allegations. Adani Green's stock has jumped more than 65% since the top court made these observations end of last month.

— With assistance from Kartik Goyal

Disclaimer: This article first appeared on Bloomberg, and is published by a special syndication arrangement.