Adani Enterprises Board Approves Demerger Of Food FMCG Business And Integrating It With Adani Wilmar

The board of directors of Adani Enterprises Ltd. approved the demerger of its fast-moving consumer goods division to Adani Wilmar Ltd. on Thursday.

The plans involve demerging of Adani Commodities LLP — which carries out trading and supply of edible oil and other allied commodities — to Adani Wilmar to enable greater focus of the management in the food FMCG business and other businesses, according to an exchange filing.

"The proposed demerger will unlock the direct value of the demerged company’s shareholders into the resulting company (Adani Wilmar) and allow a focused strategy and specialization for sustained growth for enhanced value," the filing said. No cash consideration is payable under the scheme.

Adani Wilmar is already a listed entity and Adani Enterprises holds 43.94% of the listed entity. However, post demerger, the shareholders of Adani Enterprises will directly own Adani Wilmar shares.

Post demerger, Adani Enterprises shareholders will receive 251 shares for every 500 shares of AEL or in that ratio, the company said.

The board also approved merging of Adani Green Technology Ltd. and Adani Emerging Business Pvt., which are engaged in the business of holding investments, with the flagship company. It also gave its nod to transfer the solar cells manufacturing subsidiary Adani Tradecom Ltd. to Adani New Industries Ltd.

This demerger is in line with Adani Enterprises' incubation strategy which includes demerging of the businesses once they are self-sustained and properly established.

In the past Adani Enterprises had demerged Adani Green Energy, Adani Energy Solutions (Adani Transmission earlier), etc., once they became self-sustaining.

According to the company the food FMCG business and the other businesses are capable of attracting a different set of investors, strategic partners, lenders and other stakeholders, Adani Enterprises said. "There are also differences in the manner in which the Food FMCG Business and other businesses of the demerged Company are required to be handled and managed."

Adani Enterprises' consolidated net profit rose more than two and a half times in the first quarter of this financial year to Rs 1,772.3 crore.

Shares of Adani Enterprises closed 1.57% higher at Rs 3,218.75 apiece on the BSE, compared with 0.15% advance in the benchmark Sensex.

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