New Delhi: In a major recast of operations, diversified Adani group on Friday consolidated its ports, power and mining assets into three separately listed firms and would list a new company for transmission business, while unlocking value worth over Rs 60,000 crore for the shareholders.
Under the multi-layered corporate restructuring scheme, approved by the boards of three listed firms today, the group would move away from its present 'holding company' structure and would instead have four independently listed entities for the four major business segments.
The existing shareholders of Adani Enterprises Ltd (AEL), currently the holding company, would be allotted shares of two already listed firms -- Adani Ports and SEZ Ltd (APSEZ) and Adani Power Ltd (APL) -- as also in a new company named Adani Transmission Ltd (ATL) to be listed separately.
Subsequently, AEL would effectively become mining business arm of the group, which currently commands market value of over Rs 1.5 lakh crore, after amalgmation of Adani Mining Pvt Ltd (AMPL) into this company.
The demerger will be effective from April 1, 2015 subject to regulatory approvals. The entire restructuring exercise is expected to be completed by December 31, 2015.
As per the approved share-swap ratios under the plan aimed at simplifying the group's corporate structure, the shareholders for every one share held in AEL will get 1.4123 shares of APSEZ, 1.8596 shares of APL and 1 share of ATL.
Currently, AEL has total equity base of nearly 110 crore shares, including 27.5 crore shares held by the public.
At this ratio, all AEL shareholders put together would get 155 crore shares of APSEZ (worth about Rs 52,700 crore at the current market price of Rs 340.5 a piece), 204 crore shares of APL (worth about Rs 10,600 crore at the current price of Rs 51.90), as also 110 crore shares of ATL (whose price would be determined at the time of listing).
In case of public shareholders alone in AEL, they would get APSEZ shares worth about Rs 13,200 crore and APL shares worth about Rs 2,600 crore along with some ATL shares, resulting into fresh shares worth over Rs 15,000 crore.
The group currently has three listed companies, with AEL and APSEZ having market values of about Rs 70,000 crore each and APL of about Rs 15,000 crore.
Announcing the restructuring, the group said it would provide scope for independent collaboration and expansion opportunities for each businesses and also enable investors to hold investments in businesses with different investment strategies and risk profiles.
"The proposed segregation will create enhanced value for shareholders and allow a focus strategy in operations, which would be in the best interest of all the stakeholders and the persons connected with AEL, APSEZ, APL and ATL.
"Each of the businesses has tremendous growth and profitability potential. The demerger would enable enhanced focus of management in these businesses, thereby facilitating the management to efficiently exploit opportunities for each of these businesses," the group said.
Some analysts said that this exercise is similar to the one undertaken by Reliance Group years ago when shareholders of RIL were given fresh shares in separately listed companies for different businesses, although that was necessitated by a split in the Ambani family.
Gautam Adani-led Adani Group is one of India's leading business houses with revenue of over USD 9.4 billion.
"The scheme of arrangement will simplify corporate structure providing the shareholders of AEL direct shareholding in the respective operating companies, listing of one of the largest private sector transmission companies with over 5,000 circuit kms of transmission lines across Western, Northern and Central regions of India and increase free float at APL and APSEZ," the statement said.
Without disclosing the financial implications, the group said that the scheme of arrangement will simplify corporate structure providing shareholders of AEL direct shareholding in the respective operating companies and unlock value for investors by "eliminating holding company discount".
Demerger of the Port Undertaking of AEL comprising the undertaking, businesses, activities, operations, assets and liabilities pertaining to the Belekeri port and the investment of AEL in APSEZ into APSEZ.
Demerger of the Power Undertaking of AEL comprising the undertaking, businesses, activities, operations, assets and liabilities pertaining to the 40 MW solar power project at Bitta village, Kutch district of Gujarat and the investment of AEL in APL into APL.
Demerger of the Transmission Undertaking of AEL comprising the undertaking, businesses, activities, operations, assets and liabilities related to the Mundra-Zedra transmission line and the investment of AEL in ATL into ATL.
The scheme would also include merger of AMPL into AEL.