Friday, September 22, 2023

Gautam Adani: Man of the Year

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  • Gautama AdaniIndia’s richest and the world’s third richest person, has been crowned “Asia’s Busiest Deal Maker” by Bloomberg.
  • Adani is notable for being the only person on the Bloomberg billionaires list to get rich this year – he added $44.6 billion to his net worth, while the other nine lost a combined $259.3 billion.
  • Adani’s most significant deals this year included the $10.5 billion acquisition of ACC and Ambuja Cements from Swiss construction giant Holcim and the purchase of the Israeli port in Haifa.

Gautam Adani’s rise to the top of the world’s richest people has been lightning fast. Adani is also the only person in the top ten of Bloomberg’s Billionaires Index to actually add to his net worth this year

Its group companies – spanning ports and energy – have fired on all cylinders, enriching both Adani and other investors – Adani added $44.6 billion to his wealth so far in 2022. In contrast, the other nine billionaires on the Billionaires Index lost from Bloomberg during that period cumulatively $259.3 billion.

In total, the seven listed Adani Group companies have added ₹8.55 lakh crore in market capitalization this year.

This tremendous growth in his wealth saw him briefly ranked as the second richest person in the world, behind only Elon Musk.

Adani’s net worth currently ranks third in the Bloomberg Billionaires Index and is valued at $121 billion, down from a peak of $150 billion in September this year.

French business magnate and LVMH founder Bernard Arnault – with $165 billion and Elon Musk – with $138 billion are the only two people richer than Adani. Adani often competes with India’s other richest man, Mukesh Ambani, and has left the chief of Reliance Industries – whose net worth is estimated at $86.9 billion – far behind in the race of the richest.

‘Asia’s busiest dealmaker’

The success of Ahmedabad-born Adani’s business empire has helped him top the list of the sixth edition of the ‘Bloomberg 50’ – a list
of the most influential people in global business this year. His aggressive acquisitions over the year have also earned him the title of “Asia’s Busiest Dealmaker,” with the crown jewel being the acquisition of cement giants ACC and Ambuja Cements from Swiss construction giant Holcim for $10.5 billion.

So far in 2022, Gautam Adani has closed deals in the port, construction, media and energy sectors.

Adani started the year with the listing of Adani Wilmar, an FMCG company, on the stock exchanges in February. This was just in time to reap the benefits of the war between Russia and Ukraine, which pushed up edible oil prices and boosted the company’s sales and share price.

Later in July, Adani Ports and Special Economic Zone announced it had won a tender to privatize the Port of Haifa in Israel in a $1.18 billion deal. “In the long run, this is a great port because we expect Israel to become a connection for both Europe and the Middle East, and therefore we can take advantage of the new potential trade routes that will be created,” Karan said. AdaniCEO, Adani Ports and Special Economic Zone, announcing the purchase.

The biggest deal of the year for the Adani Group was the acquisition of ACC and Ambuja Cements from Holcim for $10.5 billion in September. Together, these two companies made the Adani Group the second largest producer of cement in the country in terms of market capitalization, behind only UltraTech Cement.

$70 billion in green energy ambitions and ‘too much leverage’ concerns

In September this year, Adani also announced an ambitious new $70 billion energy plan that would see the conglomerate build three gigafactories by 2030 — one each to produce solar panels, wind turbines and hydrogen electrolysers.

However, the billionaire faced a bazooka from CreditSights, a Fitch Ratings company, which came out with a report saying that the Adani Group’s ambitious growth plans could lead to a debt trap. This frightened investors, causing the Adani Group companies to lose ₹94,000 crore market cap in a single day.

A few weeks later, however, the research firm downplayed its comments and revised estimates about the cash flow position of two group companies.

More recently, the group’s flagship company, Adani Enterprises, received approval from the board of directors to raise ₹20,000 crore through public offering (FPO), pending shareholder approval, according to the stock market filing. These funds will be used for the green energy and digital business ambitions of the Adani group.

All in all, it’s been a busy year for Gautam Adani – from starting the year with a net worth of $77 billion to becoming the third richest person in the world. It remains to be seen if 2023 will be the year Adani becomes the richest person in the world.


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