Adani Enterprises plans its Wilmar joint venture exit

The Adani Group announced on Monday that it will exit its FMCG joint venture, Adani Wilmar, by selling its entire stake. The divestment will involve selling shares to its Singapore-based partner and in the open market, with the deal estimated to be worth over $2 billion.

Adani Enterprises (AEL) plans to divest its nearly 44% stake in Adani Wilmar (AWL) in two phases. The company will first sell approximately 13% of its stake to meet public shareholding requirements. Currently, the promoters hold 88% of AWL. Wilmar International will acquire the remaining 31% stake, increasing its ownership from 44% to nearly 75%. 

According to an exchange notification, AEL will sell the 31% stake to Wilmar at a maximum price of Rs 305 per share, with the 13% stake being offloaded in the market at a similar price.

As part of the stake divestment process, Adani Enterprises (AEL) announced the resignation of its nominee directors, Pranav V Adani and Malay Mahadevia, from the board of Adani Wilmar (AWL). The company also revealed plans to rename AWL, with potential options including AWL Ltd, AWL Agri Business Ltd, and Fortune Agri Business Ltd, or any other name approved by the Ministry of Corporate Affairs. This move follows just over a month after bribery and fraud conspiracy charges were filed against Gautam Adani and others in the US.

The share acquisition will be carried out through Lence Pte., a fully owned subsidiary of Wilmar International.

“Adani Enterprises, Adani Commodities LLP (a wholly-owned subsidiary of AEL) and Lence Pte (a wholly-owned subsidiary of Wilmar International) have entered into an agreement on December 30, 2024, pursuant to which Lence will acquire all the paid-up equity shares of Adani Wilmar held by Adani Commodities as at the date of exercise of the call option or put option, as the case maybe, in respect of a maximum of 31.06 per cent of the existing paid up equity share capital of AWL”, the statement said.

The company mentioned in an official statement, “This transaction will enable AEL to focus on turbocharging growth in its core infrastructure platforms”.

AEL plans to channel the proceeds from the stake sale into key sectors such as green energy, airports, and road infrastructure, as reported by Economic Times. Earlier in October, the company raised $500 million through a Qualified Institutional Placement (QIP).

Adani Wilmar, listed in 2022, positions itself as a leader in India's edible oil and FMCG sectors. The company operates 24 manufacturing facilities across 15 cities, boasts a network of 10,000 distributors and 720,000 retail outlets nationwide, and exports its products to over 30 countries.

"The rural market in India presents significant growth opportunities, and AWL is well positioned to capture a substantial market share, by leveraging Wilmar's global operations and distribution network," Wilmar said. "enhance trade flows and sourcing capabilities" the company added.