Adani Enterprises Bids Farewell to FMCG Wilmar Joint Venture in $2 Billion Deal

Billionaire Gautam Adani-led Adani Enterprises (AEL) has announced it will end its 25-year-old FMCG joint venture with Singapore-based Wilmar International on Monday. The company, in a statement, said it will sell its 44 per cent stake worth $2 billion in Adani Wilmar. The deal is likely to be completed by the end of the financial year 2025. 

The move to pull back from the joint venture by AEL is to focus more on its core businesses including energy, utilities, transport and logistics. The amount received after offloading a 44 per cent stake will be utilised by the conglomerate to strengthen its core portfolio. 

“This transaction will enable AEL to focus on turbocharging growth in its core infrastructure platforms,” the AEL said in an exchange filing. 

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A nearly 31 per cent stake will be acquired by Wilmar at a maximum share price of Rs 305 per share, while the remaining 13 per cent will be sold to meet public shareholding norms of securities and exchange board of India (SEBI). 

The offloading process will take nearly three months for completion. Moreover, as a part of the deal, AEL’s nominee directors, Pranav V Adani and Malay Mahadevia, have already resigned from Adani Wilmer board. 

“Pursuant to execution of the Agreement, the directors nominated by ACL, i.e., Pranav V. Adani and Dr. Malay Mahadevia, shall resign from the board of directors of the Adani Wilmar Limited,” said the company in the statement. 

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Earlier in August this year, AEL had announced the demerger of its FMCG business to Adani Wilmar, but later the company called off the decision due to SEBI’s minimum public shareholding requirement. 

The recent announcement comes at a time when the profits of the company have come down from Rs 582 crore in FY23 to Rs 148 crore in FY24, marking a 75 per cent decrease. 

The shares of Adani Wilmar nosedived nearly 7 per cent to Rs 305 on Tuesday. On a year-to-date basis, the shares of the company are down by nearly 17 per cent to Rs 305.85.