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Adani to prepay $500mn loan as banks balk to refinance

February 10, 2023

Adani to prepay $500mn loan as banks balk to refinance
The Adani Group plans to prepay a $500 million bridge loan due next month after some banks balked at refinancing the debt following a short seller report that sent the group’s assets tumbling.

Barclays Plc, Standard Chartered Plc and Deutsche Bank AG are among banks that lent Adani $4.5 billion to finance the purchase of Holcim Ltd. cement assets last year. A portion of that loan is due March 9.

The lenders were in talks to refinance the loan up to a week before the critical report from Hindenburg Research was published, according to people familiar with the matter. Those negotiations stalled after the report alleging fraud led to a massive selloff, chilling the banks’ willingness to refinance, the people said, asking not to be identified discussing a private matter.

The development is the first concrete sign that global banks are becoming more wary of financing Adani’s empire and coincides with comments from France’s TotalEnergies SE that a multi-billion dollar plan to produce green hydrogen with the Indian tycoon has been put on hold, pending audits of his conglomerate. MSCI Inc. said on Wednesday it will review the eligibility of some Adani securities in its widely followed benchmark indexes, while major asset managers in Japan are stepping up disclosure over funds with exposure to Adani, signs of skittishness among international investors that could dampen a nascent rally in Adani shares.

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