ADANI BACK IN $100bn CLUB A YEAR AFTER SHORT-SELLER BLOW
▶ Daiso founder Hirotake Yano dies at 80, George Soros becomes biggest shareholder in Audacy and Kumar Birla plans US listing for Novelis, writes Felicity Glover
… THE UPS AND DOWNS OF THE SUPER-RICH
Gautam Adani has returned to the exclusive $100 billion club one year after a scathing report by US short-seller Hindenburg Research accused companies owned by the Indian tycoon of “brazen” market manipulation and accounting fraud.
Mr Adani has a net worth of $103 billion and is the world’s 13th richest person as of Friday, according to the Bloomberg Billionaires Index.
So far this year, the Adani Group chairman has added $18.3 billion, or 21.7 per cent, to his personal fortune.
However, Mr Adani’s net worth is well off the peak of nearly $150 billion he reached in September 2022. He had then briefly overtaken Amazon founder Jeff Bezos as the world’s second-richest person.
In January last year, Hindenburg Research alleged accounting fraud, improper use of offshore tax havens and stock manipulation by Mr Adani, sparking a sharp fall in his companies’ share prices and his net worth.
The Adani Group lost more than $150 billion in market value at one stage last year.
Mr Adani, who denies Hindenburg Research’s accusations, took a series of measures to calm traders concerned about the group’s access to financing.
In the year since the release of the report, Mr Adani’s ports-to-power empire has trimmed debt, pared founders’ share pledges, won new backers from the US to the Middle East, bagged projects and communicated more often with investors and lenders.
The conglomerate also rebounded after India’s Supreme Court last month ruled that no new investigations were needed into Hindenburg’s allegations and ordered the Securities and Exchange Board of India, the market regulator, to end its inquiry within three months.
At the same time, Mr Adani’s net worth jumped and he briefly overtook Mukesh Ambani, chairman of Reliance Industries, as Asia’s richest person.
However, Mr Ambani has since reclaimed the title with a net worth of $114 billion and is ranked the 11th wealthiest person in the world, according to the Bloomberg Billionaires Index.
Mr Adani started to climb the ranks of the world’s richest in April 2022, when shares in his listed companies rocketed. He ended 2022 as the world’s third-richest person, with a fortune of $119 billion.
He closed out 2023 as the world’s 15th richest person with a fortune of $84 billion after shedding 30.1 per cent of his net worth during the year.
Mr Adani is a first-generation entrepreneur who began his career as a diamond trader in Mumbai in the 1980s. He helped to run his brother’s plastics business in his home state of Gujarat before setting up Adani Enterprises – the group’s flagship company – as an agricultural commodities trader in 1988.
Hirotake Yano
Hirotake Yano, the founder of Japanese discount retailer Daiso Industries, has died of heart failure. He was 80.
He died in Hiroshima on February 12, the company said. Close family members held a private funeral, and he will be commemorated at a gathering in the near future, it said.
Known as a pioneer of the dollar-shop business model, Mr Hirotake had a net worth of about $1.9 billion at the time of his death, according to the Bloomberg Billionaires Index.
After graduating from Tokyo’s Chuo University in 1967, he worked different jobs – including running his fatherin-law’s fishery until it went bankrupt – before he started hawking goods from the back of a lorry in 1972.
That gave him the idea of charging a flat 100 yen (66 US cents) for all his merchandise to save the time it took to attach the price tags.
He incorporated Daiso, which translates to “creating something big”, in 1977.
The company became successful as stagnant wages and a sputtering economy led Japanese consumers to look for cheaper goods.
The business model has also become popular in other countries, including in the UAE, where Daiso has 50 branches and sells products for as little as Dh7.50 ($2.05), according to the company.
Closely held Daiso, with revenue of 589.1 billion yen ($3.9 billion) in the year that ended in February 2023, had 4,360 domestic stores and 990 overseas locations by the end of December, according to the company’s website.
George Soros
Soros Fund Management is positioned to become the biggest shareholder of Audacy when the radio and podcast company emerges from bankruptcy.
The investment firm founded by billionaire George Soros has scooped up more than $400 million of Audacy’s highest-ranking debt, bankruptcy court filings show. That makes it by far the biggest member of a group of lenders planning to swap their loans for stock in the broadcaster.
“The decision by our existing and new debtholders to become equity holders in Audacy represents a significant vote of confidence in our company and the future of the radio and audio business,” Audacy said.
Soros Fund Management and lawyers for the creditor group did not respond to requests for comment.
Audacy is just the latest media investment for Mr Soros. His fund was part of a group of lenders that bought Vice Media out of bankruptcy last year and earlier took a minority stake in podcast company Crooked Media.
Audacy, the second-largest radio broadcaster in the US, filed for bankruptcy in January, crushed by about $2.7 billion of debt. The radio and podcast company counts New York’s 1010 WINS among its stations.
Under Audacy’s bankruptcy plan, existing shareholders would be wiped out and high-ranking creditors would be repaid with stock in the restructured company. The proposal requires bankruptcy court approval.
Kumar Birla
Billionaire Kumar Birla plans a US listing for Novelis, the world’s largest maker of flatrolled aluminium products used in everything from cars to soft drink cans.
Atlanta-based Novelis has submitted a draft registration statement with the Securities and Exchange Commission for a proposed initial public offering of its common shares, the company said.
Stock will be offered by a unit of parent company Hindalco Industries and Novelis will not receive any proceeds from the sale, it said. Hindalco purchased Novelis in a multibillion-dollar deal in 2007 and the US unit contributed to more than 60 per cent of the Indian company’s revenue in the last financial year.
The move comes shortly after Novelis flagged a sharp escalation in capital expenditure costs for a new aluminium rolling and recycling plant in Alabama, which prompted several analysts to downgrade the Mumbai-based parent company.
The increased expenses could make it hard for Novelis to generate free cash flow during fiscal 2024-28, according to Bloomberg Intelligence.
Although it is unclear how many shares will be offered, or how the funds raised will be used, a listing would be positive for Novelis, according to Nuvama Wealth Management.
The process could take at least six months, analysts Ashish Kejriwal and Jyoti Singh said.
Hindalco had net cash of about 34 billion rupees ($410 million) at the end of December and proceeds of the sale could be used to expand inorganically, pay a one-time dividend or return capital to the parent company, according to Nuvama.
Novelis expects to complete the public offering after the SEC finishes its review process, subject to market and other conditions, the company said.